AEW REIT said today it was looking at new transaction opportunities in offices and retail, having spent previous quarters focused on the industrial sector.
In second-quarter results, the company said that over recent weeks it was seeing an increasing number of “attractive opportunities in the retail and office sectors and we therefore expect that future acquisitions will represent a more balanced spread of property sectors, rather than being concentrated in the industrial sector as we have seen over past quarters”.
Recent deals include the acquisition of an industrial asset in Runcorn, Cheshire, for £610,000, completing the company’s ownership of the entire Sarus Court industrial estate, the purchase of a 97,000 sq ft single-let industrial building on the Deeside Industrial Park, North Wales, for £4.3m, and the acquisition of a 182,000 sq ft single-let industrial building in Peterborough, Cambridgeshire, for £5.7m, reflecting a net initial yield of 8.64% and a capital value of £31 per sq ft.
The property investment group, which owns 32 regional UK commercial assets, said NAV rose to £119.76m, or 96.86p a share, from £118.68m and 95.98p a share at the end of April.
The company is now fully invested, having utilised its loan facility and reinvested the proceeds from selling its remaining investment in the AEW UK Core Property Fund during the quarter.
The group’s portfolio was valued at £150.38m, compared to £137.82m at the end of April, primarily as a result of the three new acquisitions.
Alex Short, portfolio manager AEW UK REIT, said: “Despite some uncertainty caused by the general election, the performance of the company’s assets has continued strongly over the past quarter with like-for-like valuation growth of 1.4% recorded.
“This compares favourably to MSCI data which shows that the market as a whole delivered growth of 1.1% over the quarter to 30 June 2017 on a ‘standing investment’ basis. We are particularly pleased with the capital appreciation delivered by the company’s industrial assets which have seen the strongest growth of all of the sectors in which the company is invested, at an average of 2.8% within the quarter.
“The portfolio has been particularly well placed to benefit from this movement with its high weighting towards the industrial sector where many of our recent acquisitions have been focused.”
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