Mayfair Capital Investment Management’s charity fund has acquired a distribution warehouse in Droitwich, Worcestershire, for £16.9m.
The Property Income Trust for Charities bought the 203,442 sq ft shed, called The Big Berry, in a deal that reflected a net initial yield of 5.44%.
The vendor was a joint venture managed by Oxenwood Real Estate.
The asset, located on the Berry Hill Estate, is let to Antolin Interiors UK until 2024 at a passing rent of £981,272 pa. Its current rent is £4.82 per sq ft.
Mayfair Capital investment director Phil Sturdy said: “There is a shortage of warehousing along the M42 corridor which, in combination with strong recent take‐up, has put upward pressure on rents.”
Simon Martindale, the fund manager for The Property Income Trust for Charities, said: “The acquisition provides PITCH with exposure to the strong West Midlands industrial market and has the benefit of a rent review in December next year, where we expect to see income growth.
“We are seeing increasing value in emerging warehouse locations such as Droitwich where the greater availability of labour is an increasing draw for occupiers.
“The acquisition of the asset is in line with our investment approach which seeks to identify latent demand created by underlying business and demographic trends. A significant outcome of this has been the Fund’s high weighting to the warehouse sector, which is now up at 35% and a contributing factor to PITCH’s continued outperformance.”
Lambert Smith Hampton advised Mayfair Capital; M1 advised the vendor.
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