11th May 2016 07:23
LONDON (Alliance News) - Real Estate Investors PLC on Wednesday said it purchased two properties in Telford and Nottingham, for GBP5.1 million, part of its strategy to purchase "additional criteria compliant assets during a period of uncertainty created by the European vote".
The two properties will produce a combined rental income of GBP506,710 per year, and have a net initial yield of 9.3%, Real Estate Investors said.
The Birmingham-based property investor said the property in Telford is in a business park and comprises of 33,166 square feet of modern office accommodation over four floors.
The Telford property is let to infrastructure services company Hewlett Packard Enterprise Service UK Ltd with 4.5 years remaining and a current rental income of GBP270,000 per year. The purchase price reflects a net initial yield of 9.9%.
Real Estate Investors said the other property is in Nottingham and comprises a mixed use development, with three retail units occupied by supermarket Sainsbury's, children's charity Banardos and bathroom retailer Bathstore Ltd. The property produces a rental income of GBP216,710 per year and the purchase price reflects a net initial yield of 8.5%, Real Estate Investors added.
Real Estate Investors said it has spent GBP15.6 million on acquisitions in 2016 to date and its contracted rental income is now GBP13.4 million, up 13% since year end.
"We have taken the opportunity to acquire additional criteria compliant assets during a period of uncertainty created by the European vote. We have further assets under offer and we are confident of achieving our contracted rental income and progressive dividend objectives," said Chief Executive Paul Bassi.
The UK is set to vote on whether to remain a member of the European Union or leave in a referendum scheduled for June 23.
"We remain on course to establish a portfolio under management in excess of GBP200.0 million in the short term," Bassi added.
Shares in Real Estate Investors were unchanged at 62.00 pence on Wednesday morning.
By Hannah Boland; [email protected]; @Hannaheboland
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