LondonMetric has paid £53.4m for a cold storage and logistics warehouse development near Huntingdon in Cambridgeshire.
The 300,000 sq ft building has been prelet on a 25-year lease to flower-to-fruits supplier AM Fresh Group. The company, which supplies the majority of UK supermarkets, will pay £2m pa rent, which equates to a low £6.70 per sq ft. The rent is subject to five-yearly CPI+1 linked reviews. The acquisition yield of 3.7% is expected to rise to 4.3% at the next review.
The development is located at Alconbury Weald, on the A1(M) outside Huntingdon. The nearby A14 interchange provides a direct link to Felixstowe port. To suit its occupier, the building will be a highly specified cold storage, production and logistics warehouse, fitted out with state-of-the-art robotics and automation. It will also include an innovation centre and incubator for agritech R&D.
The building will be certified BREEAM Very Good and construction by AM Fresh has commenced, with completion expected in December 2022. LondonMetric will receive a funding coupon of 3.7% during the development.
LondonMetric chief executive Andrew Jones said: “This is a high-quality development benefitting from a very long lease to a market leader in fresh produce and adding an exceptional building to our portfolio. We are excited about working in partnership with AM Fresh as we use our expertise to help deliver their new warehouse and build a long-term relationship.”
Enrique Lopez, CFO at AM Fresh, added: “The new building will allow us to further develop our fruit business in the UK… This is an important addition to our global portfolio of logistics and production facilities, and we look forward to delivering the building with our new partners at LondonMetric.”
BNP Paribas Real Estate advised AM Fresh; Cortex Partners advised LondonMetric.
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