9th Oct 2019 10:02
(Alliance News) - LXi REIT PLC on Wednesday said it has made acquisitions worth GBP23 million, reflecting a weighted average net initial acquisition yield of 5.7%, net of acquisition costs.
The real estate investment trust said these acquisitions were funded by its new revolving credit facility.
LXi REIT said it will receive an income from the developers during the construction periods.
The acquisitions comprise Premier Inn hotel in London, which has been pre-let to hotel operator Premier Inn Hotels Ltd, with a guarantee from its parent Whitbread Group PLC, on a new 25-year lease from completion of the building works, with five yearly rental uplifts.
LXi REIT also bought a new servicing and sales centre for Mercedes commercial vans and trucks in Smethwick, Birmingham. The new development will comprise 35,647 square feet of warehouse, servicing, showroom and office space over two floors, on a four acre site.
This property has been pre-let to Midlands Truck & Van Ltd, with a guarantee from its parent logistics firm Ballyvesey Holdings Ltd, on a new, 30-year lease from completion of the building works, also with five yearly rental uplifts.
LXi REIT said it purchased a recently constructed 25,000 square feet foodstore, which has been let to supermarket chain Aldi Stores Ltd on on a long lease, with over 19 years unexpired to first break. The rental uplifts are fixed at 2.5% per annum compounded and the current passing rent equates to a low GBP10 per square feet.
"We are pleased to be acquiring, on an off-market basis, these attractively-priced assets let on long leases to strong tenant covenants across robust sectors with high residual values, which are expected to provide our shareholders with further diversified, secure and inflation-linked income and capital growth potential," said John White, partner of investment manager LXI REIT Advisors Ltd.
LXi REIT shares were trading marginally higher on Wednesday in London at 129.60 pence each.
By Evelina Grecenko; [email protected]
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