Merry Hill multiplex sold in £7.7m deal

THE multiplex cinema at the heart of Dudley’s Merry Hill Shopping Centre has been sold in a deal worth £7.7m.

LondonMetric Property has exchanged on the sale of the Odeon cinema to clients of Aberdeen Asset Management. The deal reflects a net initial yield of 5.95%, falling to around 5.8% in June when a further top-up is due.
 
The 10-screen, 40,200 sq ft cinema is let to Odeon Cinemas Ltd for a remaining term of 24.7 years with no breaks. The lease is subject to annual rental increases of between 1% and 5% linked to the annual RPI index.
 
The property formed part of a portfolio of 10 Odeon Multiplex Cinemas acquired by LondonMetric in November 2013 for £80.6m, reflecting an overall net initial yield of 7.2%.
 
Andrew Jones, chief executive of LondonMetric, said: “This disposal further demonstrates strong institutional interest for regional property with long-dated income let to robust covenants. We will continue to recycle capital opportunistically with an increased focus on new investments in our preferred out of town and retail distribution sub-sectors.”
 
Knight Frank advised LondonMetric and Strutt & Parker advised Aberdeen.