Motorway services snapped up in £35m deal
WOOLLEY Edge Services near Barnsley has been acquired for more than £35m by a leading fund manager, representing the largest ever single-asset investment transaction in the sector.
The services on the M1, originally opened in 1972, is run by Moto, the UK’s largest service area operator.
High street names located at the site include M&S, Costa Coffee, Burger King and Travelodge. The station also acts as an interchange point for Megabus coaches.
Knight Frank’s specialist property investment team and newly formed automotive team advised on the deal.
The acquisition follows a spate of activity in the sector in recent years, with over £250m of investment assets traded in 2013.
Adam Chapman, head of the national automotive team at Knight Frank, who has provided advice on over 90% of all service area investment stock in the last five years, said: “Service areas offer remarkably strong investment credentials, being extremely defensive, due to high barriers to entry, and providing a robust hedge against rising inflation.
“Yet opportunities to acquire comprehensive service area assets are extremely rare, with the majority of the network being held freehold.
“The sector has witnessed an extraordinary resurgence in the last decade, due in part to the introduction of major high street brands and a relaxation in government policy, and with increasing investor involvement, highly impressive ‘airport-like’ facilities are likely to one day be the norm.”
The automotive team also advises on franchised vehicle dealerships, petrol filling stations and roadside retail, and works closely with Knight Frank’s specialist property investment team, which covers the full range of alternative sectors including hotels, healthcare and student accommodation.
Charles Fletcher of Knight Frank’s specialist property investment team, added: “This transaction highlights the continued appetite from institutional investors wishing to gain exposure to specialist sector assets which can offer excellent returns and diversity of income across their funds.”
Cushman and Wakefield advised the vendor.