7th Sep 2015 06:41
LONDON (Alliance News) - Real estate investor Redefine International PLC on Monday said it has reached a conditional deal to acquire the AUK Portfolio from Aegon UK Property Fund for GBP437.2 million.
Redefine, the FTSE 250 company, said it will acquire the portfolio through its Redefine AUK subsidiary. The portfolio includes 19 properties in the UK, mostly in London and the South East, valued at a total of GBP439.9 million, with six single-let and the rest multi-let.
The net initial yield on the acquisition is 5.0%, Redefine said. The assets generate an annual passing rent of GBP23.5 million and the occupancy level is currently at 96.7%, though Redefine said there are "numerous identified asset management opportunities to reduce voids and associated carrying costs, which will drive both higher income returns and capital values".
"This is a transformational deal for Redefine International, which rapidly improves the quality and scale of our overall portfolio, supporting our growth plans and strategy to generate consistent and growing income returns. This also represents an efficient recycling of our cash balances following sales of Cromwell and other non-core assets and investment of March's placing into this high quality portfolio," said Mike Watters, Redefine's chief executive.
In addition, Redefine said it has struck a GBP52.5 million deal to acquire Banbury Cross Retail Park in Oxfordshire. The park generates an annual passing rent of GBP3.1 million, and the purchase price reflects a net initial yield of 6.4%.
By Sam Unsted; [email protected]; @SamUAtAlliance
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