Urban Logistics REIT has kicked off what it calls a “selective recycling” initiative that will let it take advantage of “attractive acquisition opportunities”.
Announcing interim results for the six months to 30 September, investment adviser chief executive Richard Moffitt said the REIT had unconditionally exchanged on the sale of a £7.7m building in Peterborough, let to Anglian Water, at a net initial yield of 4.85%.
Urban Logistics developed the building in 2020, at a total cost of £5.8m, providing a 33% profit on cost and an ungeared IRR of 12.3%.
“The capital released will be recycled into higher yielding opportunities,” Moffitt added. “Looking forward we see significant value potential within the portfolio, which the company will continue to realise through the team’s hands on approach to asset management as well as the recycling of the value created in ‘core’ assets into higher yielding assets as the company drives for full dividend cover.”
The company posted gross rental income of £30.6m, up 3%, across a portfolio the value of which was broadly flat at £1.1bn. Profit dropped by 40% to £10.2m.
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