LondonMetric Property has sold the freehold of the Odeon multiplex cinema in Taunton, Somerset, to Asda Pension Fund for £9.1m – a 5.5% yield.
The property will form part of a portfolio managed by OLIM Property.
The five-screen, 27,000 sq ft cinema is let to Odeon Cinemas for a remaining term of 22 years. The rent rises annually in line with RPI by between 1% and 5%.
The property formed part of a portfolio of 10 Odeon multiplexes acquired by LondonMetric in November 2013 at an overall net initial yield of 7.2%. LondonMetric continues to own six Odeon cinemas and one VUE cinema with an average lease length of 22 years.
Andrew Jones, chief executive of LondonMetric, said: “Since acquisition, this asset has generated a strong income return and benefitted from yield compression as demand increasingly focuses on long and predictable income.”
Matthew Oakshott, chairman of OLIM Property, said: “We exchanged contracts in a week after terms were agreed and solicitors instructed. Unlike most other fund managers, we’re not sitting on our Brexits.”
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