LGIM Real Assets has acquired Woodside Industrial Estate in Dunstable, Bedfordshire, from Harbert Management Corporation for £182.3m, reflecting a net initial yield of 5.02%.
Legal & General has bought the asset on behalf of two separate funds – the Legal & General UK property fund and its Managed Property Fund – in a 50:50 joint venture.
Woodside is one of the largest single-ownership industrial estates in the South East and represents one of the largest acquisitions of its kind in the region in recent years.
The South East industrials segment is expected to outperform all others over the forecast period (2018-2022), with a projected average total return of 5.7% per annum.
The property comprises 35 units totalling 1.5m sq ft and occupies 96 acres.
Eighteen of the units are either new or recently refurbished and L&G said the remaining 17 offer substantial rental enhancement through a rolling refurbishment plan.
On the western boundary of the estate there is also a development site of 1.4 acres.
Senior fund manager Mark Russell said: “This is an excellent buy for the fund, providing a rare opportunity to gain exposure to a large South East industrial asset.
“The purchase is also in line with our strategy of buying assets with strong fundamental characteristics and positive occupational dynamics, which are set to deliver strong returns to our investors.”
Matt Jarvis, senior fund manager of the Legal & General UK Property Fund, said: “The UK logistics and industrial property sector continues to outperform all other property sectors, making this a strong purchase for the fund and its investors.
“The estate provides many asset management opportunities, which will enable us to move rents forward as well as increasing the overall asset value.”
JLL advised Legal & General; DTRE represented Harbert Management Corporation.
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