8th Jun 2016 07:59
LONDON (Alliance News) - Real Estate Investors PLC, the Birmingham-based property company, on Wednesday said it has bought a shopping centre in Crewe, Cheshire for GBP20.0 million from the Scottish Widows Ltd.
Real Estate Investors said it paid the GBP20.0 million to Scottish Widows, which forms part of the insurance arm of Lloyds Banking Group PLC, through its existing cash resources and bank facilities, representing a net initial yield of 9.0%.
The shopping centre produces GBP2.2 million rental income per year, with a weighted average lease expiry of 5.14 years to expiry and 4.35 years to break, Real Estate Investors said.
The company added that there are 25 retail units at the site, with a total of 154,130 square feet of retail and ancillary accommodation, and 294 external car parking spaces. Contracted tenants include fashion retailer River Island, bank Halifax and supermarket Iceland.
Real Estate Investors said the site was "fully criteria compliant" with its investment strategy, noting that there was also scope to restructure the scheme which will provide potential for significant capital uplift.
The acquisition takes its total acquired assets in the year to date, since December 31, to more than GBP35.0 million, and means its current contracted rental income will increase to GBP15.7 million
"We have continued to acquire criteria compliant assets during the period of uncertainty created by the European vote. Additionally, we have a number of ongoing sales and acquisitions that are in our legal pipeline, or in advanced discussions, with numerous new lettings and lease renewals from within the existing portfolio, which will enhance rental income and our average lease lengths," said Chief Executive Paul Bassi.
Shares in Real Estate Investors were down 0.8% at 61.00 pence on Wednesday.
By Hannah Boland; [email protected]; @Hannaheboland
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