TIDMSHED
RNS Number : 1456X
Urban Logistics REIT PLC
25 August 2022
25th August 2022
Urban Logistics REIT plc
("Urban Logistics" or the "Company")
Acquisition of GBP90 million of assets with significant value
creation potential
Urban Logistics (LON: SHED), the last mile logistics focused
REIT, has acquired GBP90 million of assets at a blended net initial
yield ("NIY"), post near term asset management, of 4.5%, with
significant potential for further value creation through active
asset management.
Key Highlights:
-- Five properties acquired, with NIY ranging from 4.2% to 6.5%; 4.5% on a blended basis.
-- Four properties are income-producing and one property is vacant.
-- One significant property of 97,362 sq. ft. acquired in Southall, West London.
Richard Moffitt, Chief Executive, commented:
"During recent market volatility we have been deliberately
patient in our deployment, and that patience has been rewarded by
our ability to acquire these properties in prime locations on
advantageous terms.
"Our occupational market, with its focus on supply chains for
essential goods, remains strong with continued upward pressure on
rents. We firmly believe that, at any stage in the property cycle,
if we improve lease lengths we will see yield compression.
"We therefore see substantial potential valuation increases in
these acquisitions, driven by our asset management plans."
Acquisitions:
Brent Road, Southall
A 97,362 sq. ft. warehouse in West London, fitted out for frozen
food storage. The purchase price paid was GBP46,000,000 at a NIY of
1.9% with two months remaining on the lease. The property is highly
reversionary, with the current tenant paying GBP10 psf and rents in
the area being in excess of GBP25 psf. We anticipate quickly
letting the property to capture this reversionary yield, and
anticipate signing a new long term lease providing a yield of 4.2%,
which should create a significant valuation increase.
Beveridge Lane, Bardon
A 249,211 sq. ft. logistics warehouse two miles from the M1. The
purchase price paid was GBP35,385,000 at a NIY of 4.7%. The unit is
let to DHL Supply Chain Ltd on a lease expiring in 2027. The asset
has near term asset management potential.
Downgate Drive, Sheffield
A 31,105 sq. ft. newly refurbished industrial warehouse close to
the M1. The purchase price paid was GBP3,120,000 at a target NIY of
6.1%. The unit is currently vacant and is being marketed.
Fowler Road, Dundee
A 29,834 sq. ft. logistics warehouse on the West Pitkerro
Industrial Estate. The purchase price paid was GBP2,800,000 at a
NIY of 6.5%. The unit is let to the DPD Group on a lease expiring
in 2027.
Silkstone Road, Barnsley
A 24,230 sq. ft. industrial warehouse located in the Dodworth
Business Park. The purchase price paid was GBP2,600,000 at a NIY of
5.2%. The unit is let to a vintage clothing operator, who process
and sort textile recycling on site, with the lease expiring in
2029. The low rent of GBP6.00 psf is subject to an open market
review in 2024 offering good reversionary potential, with rents in
this area being in excess of GBP7.50 psf.
- Ends -
Urban Logistics REIT plc
Richard Moffitt +44 (0)20 7591 1600
Buchanan +44 (0)20 7466 5000
Helen Tarbet +44 (0) 7872 604453
Simon Compton +44 (0) 7979 497324
George Beale +44 (0) 7450 295099
---------------------
Singer Capital Markets - Joint Broker
James Maxwell / Alaina Wong / Oliver Platts
(Corporate Finance)
Alan Geeves / James Waterlow / Sam Greatrex
(Sales) +44 (0)20 7496 3000
---------------------
Panmure Gordon (UK) Limited - Joint Broker
Chloe Ponsonby (Corporate Broking)
Emma Earl (Corporate Finance) +44 (0)20 7886 2500
---------------------
About Urban Logistics REI
Urban Logistics REIT plc (LON: SHED) is a FTSE 250 property
investment company. The Company is the only listed London-listed
REIT to focus on specialist last mile / last touch logistics
assets, with a tenant base which delivers essential goods within
the UK. The Company's strategy is to invest in mid-sized logistics
properties with the objective of generating attractive dividends
and capital returns through active asset management.
Urban Logistics' investment management team, led by Richard
Moffitt and Christopher Turner, has over 50 years' experience in
investing in the logistics market within the broader real estate
market. The team's ability to source vital and strategically
located mid-sized single let properties, with high-quality tenants,
off-market at favourable terms, creates considerable value for
shareholders. Tenants include Amazon, GXO, DHL, Hermes, DPD, Boots,
Unipart (for NHS) and J Sainsbury Plc.
Buying well and pursuing additional value enhancing asset
management initiatives has driven the Company's growth, enabling
Urban Logistics to grow from a GBP10m market cap company at IPO in
April 2016 to c. GBP800m at present.
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END
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