LondonMetric Property has bought 14 urban and regional logistic warehouses for £116.6m from Cabot Properties.
Half the warehouses are located in the South East and Midlands. Eleven of the 14 buildings are last mile or urban logistic warehouses.
Andrew Jones, chief executive of LondonMetric, said: “Following recent non-core disposals of Milford Haven, Loughborough and Marlow totalling £116.3m, we are pleased to have re-invested the sale proceeds into the distribution sector within such a quick timescale.
“The urban logistics market continues to benefit from a highly favourable demand/supply imbalance and this acquisition further increases our critical mass in this sub-sector to over £260m across 38 assets. The acquired portfolio is fully income generating and offers good opportunities to extend lease lengths and capture strong income growth.”
The 1.3m sq ft portfolio has a unexpired lease term of 5.6 years and is let at an average rent of £5.50 per sq ft, with an ERV of £6.00 per sq ft – a yield on cost of 6.1% and a reversionary yield of 6.6%.
60% of the £7.2m income is from retailers and third-party logistics operators including DHL, Howdens, Unipart and Royal Mail.
This acquisition increases LondonMetric’s distribution weighting to 69% and LTV to 37%.
LondonMetric was advised by JLL. Accord Capital Partners and its affiliate, Accord Europe, served as global capital advisor to Cabot Properties.
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