Property investor offloads industrial unit for £1.4m

Custodian REIT has sold an industrial unit in Scotland for £1.4m, 12% ahead of its June valuation.

The Leicester property investor told the London Stock Exchange it opted to offload the 18,424 sq ft warehouse and distribution unit in Kilmarnock because the building’s environmental credentials “no longer fit with [its] ESG objectives.”

Having recently increased the lease term by 10 years, Custodian added, the time was right to sell “and crystallise a valuation uplift.”

The company acquired the property in 2014.

Richard Shepherd-Cross, managing director of the New Walk firm’s external fund manager Custodian Capital Limited, said: “The sale of this industrial unit at a premium to valuation demonstrates the ongoing liquidity in the market for smaller lot sized commercial real estate, underscoring our investment thesis.

“Having acquired this property as part of our IPO portfolio eight years ago and having recently increased the lease term until 2032, we felt that now was an opportune time to crystallise the value we have created. The proceeds of the disposal will be recycled into identified improvements to the remaining portfolio which we believe will be more accretive and better support the strategy of providing shareholders with strong income returns.”