Cheshire munitions factory up for sale

A CHESHIRE building occupied by defence manufacturer BAE Systems has  been put up for sale for £49.7m.

The Radway Green Small Arms Ammunition facility is to be offered to the commercial investment market and is expected to generate interest from a mixture of UK and overseas investors.  

The plant was redeveloped in 2011 by BAE Systems at a cost of £83m providing state of the art production munitions facilities. The site has produced bullets for over 75 years mainly for British Army, and is capable of manufacturing 1 million small-arms bullets a day.

Commercial property consultants GVA is managing the sale.

Formerly a Royal Ordnance factory, the 254,000 sq ft site was acquired by BAE Systems in 1987, and it has continued production of bullets and other munitions since then.

The facility is let to the company until 2036, at a current rent of £2.9m per annum with the rent rising every year.

Additionally, BAe Systems currently has a 15-year Munitions Acquisition Supply Solution contract with the UK Ministry of Defence, guaranteeing production at the site until 2023.

Based on the guide purchase price of in excess of £49.7 million the net initial yield is 5.5%.

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