Warehouse REIT’s £43.6m deal an ‘increasingly rare opportunity’

Andrew Bird

Warehouse REIT, the AIM-listed business with a Chester base, is to acquire a portfolio of five single-let and multi-let warehouses in a £43.6m deal.

The firm, which invests in e-commerce urban and last-mile industrial warehouse assets, said the package totals 570,000 sq ft and is owned by Greenstone Property Holdings Limited.

It said the purchase price reflects an attractive blended net initial yield of 6.7% and provides a combined WAULT of 5.5 years.

Located in established logistics markets, the portfolio is 90% occupied on leases with a total contracted annual rent of £2.95m. The portfolio has been independently valued by CBRE as at September 29, 2020 at £44.55m in aggregate.

It comprises Gateway Park, next to Birmingham Airport, a 50,000 sq ft unit on Viables Business Park in Basingstoke, Chittening Industrial Estate in Avonmouth, outside of Bristol, a three-unit warehouse property on Newport Road, Cardiff, and a 54,000 sq ft warehouse in Ebbw Vale, South Wales.

These latest additions continue the deployment of July’s £153m equity raise and take Warehouse REIT’s portfolio to more than seven-and-a-half million sq ft, providing multiple opportunities for value creation through asset management, while further improving cost ratio efficiencies.

Andrew Bird, managing director of the investment advisor, Chester-based Tilstone Partners Limited, said: “This is an increasingly rare opportunity to acquire an immediately accretive and diverse portfolio of assets which fits with our stated investment strategy, whilst offering both short and longer-term asset management opportunities through a mixture of vacancy and short income.

“Despite strong competition for industrial assets, as an increasingly diverse range of occupiers seek to ensure their businesses are fit for purpose as e-commerce penetration accelerates, we continue to originate and successfully execute on attractive transactions.

“The focus remains on deploying the balance of the equity from July’s capital raise, leveraging our local market relationships to secure off-market opportunities, in order to further improve the portfolio metrics and generate shareholder outperformance.”

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