£15m car showroom sale drives retail development purchase

Real estate investor LondonMetric has sold a Solihull car showroom for £15m and invested part of the proceeds in a Birmingham retail site with “a significantly higher yield”.

LondonMetric took ownership of the Johnsons Volkswagen dealership site in December when it bought the Savills IM Fund.

However it identified the 52,000 sq ft site as a “non-core asset” and sought to leverage the 17 years remaining on the £800,000-per-year lease. The identity of the purchaser has not been disclosed.

Andrew Jones, chief executive of LondonMetric, said: “We have taken advantage of the strong appetite for long let income to swiftly dispose of the property at a premium.

“The proceeds of the sale have been reinvested into a better-located property offering a significantly higher yield with material asset management potential.”

LondonMetric has reinvested £8m in purchasing the retail units let to Dunelm and Currys at Middleway, Birmigham. The 40,000 sq ft site has a weighted average unexpired lease term of two years for £700,000 per annum of rent.

Its rental yield is 7.8%, compared with 4.5% at the car showroom site.