24th Mar 2014 14:17
LONDON (Alliance News) - Segro PLC and Picton Property Income Ltd Monday said they have completed an industrial property swap deal.
In a statement, Segro said it had acquired a distribution warehouse at Magna Park, Lutterworth from Picton for GBP34.0 million, while Picton has bought from Segro an industrial estate at Parkbury, Radlett for GBP40.5 million. Picton has paid Segro the balance of GBP6.5 in cash.
The Lutterworth warehouse is a 38,150 square metre single-let property leased to Primark until October 2026, with a break option in 2016. The net initial yield on the acquired asset is 8.1%, which reflects the potentially short term nature of the income, Segro said.
In a separate statement, Picton said the Parkbury site is a 32,810 square metre multi-let industrial estate located between junctions 22 and 21a of the M25. Comprising 24 units, Parkbury provides a diversified income stream from 20 occupiers including Viglen, BMI Healthcare, Franke and Blanco, it said. The net initial yield on the acquisition is 6.3%.
"This in line with our strategy to reshape our underlying portfolio into larger lot sizes which offer future income growth and follows disposals of smaller lower yielding assets earlier this year. Through this NAV accretive transaction we have removed the specific income risk associated with the Lutterworth asset,? Picton Capital Chief Executive Michael Morris said.
Segro shares were up 0.1% at 332.50 pence Monday, while Picton Property Income was flat at 57.00 pence.
By Steve McGrath; [email protected]; @SteveMcGrath1
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