North Staffs distribution centre sold for more than £30m

RETAILER New Look’s national and European distribution centre in North Staffordshire has been sold for more than £30.05m.

Property investment vehicle Tritax Big Bix REIT has bought the building at Lymedale Business Park in Newcastle-under- Lyme.

The acquired building is one of two adjoining New Look distribution centres. The distribution centre has an automated conveyor belt system that links with the adjacent property.

The deal reflects a net initial yield of 5.9%.

The purchase will be funded from equity proceeds, with senior debt finance expected to be introduced in the near term. Completion is expected to take place by May 6.
 
Constructed in 2007 and extended in 2011 to satisfy New Look’s expansion requirements, the property comprises a gross internal area of 396,937 sq ft with a site cover of 47%.

New Look has invested significant capital into the property, creating one of the most advanced automated clothing distribution facilities in the UK.

The property is being acquired with an unexpired lease term of approximately ten years, which is subject to five yearly upward only rent reviews. The next rent review is due in April 2017.
 
Bilfinger GVA represented Tritax and Deloitte Real Estate represented the vendor, Deutsche Asset and Wealth Management on behalf of a fund for institutional investors.
 
Colin Godfrey, partner of Tritax, said: “We are pleased to have acquired one of New Look’s two adjoining national and European distribution centres.

“The property has benefited from significant capital expenditure by the tenant and a c.100,000 sq ft. extension in 2011, demonstrating New Look’s commitment to the location.

“This property is strategically positioned with a critical mass of high quality occupiers in the surrounding area where there are no high quality big boxes available to let, providing a favourable dynamic for rental growth.”