Tritax Big Box REIT has completed the land purchase and exchanged contacts to provide forward funding for a new distribution centre for publishing company Hachette at Signa Park in Didcot, Oxfordshire.
The development represents an investment of £29.2m – a 5.82% yield.
The development will become Hachette UK’s main national and a global distribution centre. The property will benefit from capital investment from the tenant, including high levels of automation.
The facility will be purpose-built to a high specification, with a gross internal floor area of approximately 242,067 sq ft and an eaves height of 20 metres, together with extensive parking. The property has a low site cover of approximately 40%.
Didcot has attracted a number of occupiers, including Screwfix, XPO Logistics, and BetterBathrooms, as well as the Tesco Distribution facility in Southmead Industrial Estate, which was acquired by Tritax in 2014.
Upon practical completion of the construction, targeted for July 2017, the property will be leased to Hachette UK on a 15-year lease, subject to five-yearly upward-only open-market rent reviews.
The land purchase has been funded by from equity proceeds, with senior debt finance expected to be introduced in the near term.
Tritax partner Colin Godfrey said: “This key South East logistics acquisition provides the company with further tenant and business sector diversification whilst maintaining the weighted average unexpired lease term of the company’s portfolio at over 15 years, and is earnings-accretive. This takes our total portfolio to 38 assets.”
GVA represented Tritax; JLL represented vendor Clowes Developments and development manager Graftongate.
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