22nd Nov 2016 08:32
LONDON (Alliance News) - LondonMetric Property PLC on Tuesday said its joint venture with Universities Superannuation Scheme Ltd has bought two warehouses for a total cost of GBP18.4 million.
The FTSE 250-listed property investor said its joint venture Metric Income Plus Ltd Partnership bought the properties at a blended net initial yield of 6.8%.
The first of the two warehouses is located in Hull and was bought from infrastructure and support company Stobart Group Ltd and property asset manager Roebuck Asset Management Ltd for GBP9.4 million, reflecting a net initial yield of 7.5%. The 71,000 square foot store is currently let to home improvement retailer B&Q at GBP750,000 per annum, with an unexpired lease term of 12 years.
The second of the properties is a 40,000 square foot warehouse in Dartford, currently let to Travis Perkins PLC's Wickes brand. The property was bought from a private investor for GBP9.0 million, reflecting a net initial yield of 6.2%. Simultaneous with the purchase, Metric Income has granted a new 20-year lease to Wickes at a rent of GBP600,000 per annum, LondonMetric said.
"These are two strong income producing assets, let off an average lease term of over 15 years, generating an income return on equity in excess of 10%," said LondonMetric Chief Executive Andrew Jones.
"Both assets trade well and these transactions demonstrate our strong occupier relationships to source attractive off-market opportunities, in both the retail and logistics sector," Jones added.
Shares in LondonMetric were up 0.5% at 143.40p on Tuesday morning.
By Hannah Boland; [email protected]; @Hannaheboland
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