Major retail distribution warehouse bought for £13m
A MAJOR retail distribution centre in Yorkshire has been acquired in a deal worth £13m.
LondonMetric Property Plc has exchanged on the acquisition of the Superdrug Distribution Centre in South Elmsall, Doncaster from OLIM Property acting on behalf of BAE Systems Pension Fund.
The purchase price is £13m, net of acquisition costs, reflecting a net initial yield of 7.3%. The acquisition is expected to complete in June 2014 and will be funded from LondonMetric’s existing resources.
The 292,500 sq ft distribution centre is located along the A1(M) motorway, two miles north west of Junction 38. The unit is fully occupied by Superdrug which has recently re-geared its lease to 2025 with a break in 2020.
The unit caters for all of Superdrug’s online business and is one of only two units in the UK servicing its 900 stores in the UK & Ireland. Adjacent occupiers include Next, Asda and Findlays.
Following this acquisition, the LondonMetric distribution portfolio comprises 11 distribution centres with a combined value of £261.8m, representing 25% of the enlarged group’s portfolio. The weighted average unexpired lease term across the distribution portfolio is 12.8 years (12.1 years to first break) and the portfolio is 99.5% occupied. Fixed rental uplifts across the distribution portfolio represent 47% of total distribution rental income. Across the group’s investment portfolio fixed rental uplifts represent 34% of contracted rental income.
