Segro sells Trafford and Heywood industrial parks

INDUSTRIAL property giant SEGRO has announced the sale of four “non-core” assets including Trafford Park and Heywood Distribution Park on a £200m-plus deal.

The firm has exchanged contracts on both estates, as well as the Kings Norton Business Centre and Meteor Park in Birmingham, in a deal worth £204.5m, to a fund which has been advised by Harbert Management Corporation (Europe).

Following the sale, which is contingent on the purchaser finalising banking arrangements, SEGRO plans to close its offices in Manchester and Birmingham.

The four estates contain over 4.7m sq ft of lettable space and by the end of March had a vacancy rate of 20.5%. The price paid represents a net initial yield of 6.7%, but the price is 2.9% below book value.

Phil Redding, SEGRO’s Chief Investment Officer, said: “In the year to date, assuming the completion of this transaction, we have announced non-core asset disposals of £377 million, with further disposals expected during the remainder of the year.

“This latest announcement is another important step forward in the process of re-shaping our portfolio to focus on core markets.”