AXA Real Estate has paid a record yield for non-annuity-grade industrial assets.
AXA will pay £34.2m – a 4.35% net initial yield – for two sheds in east Staffordshire, as demand for long-let industrial assets continues to rocket. It has bought the properties in a sale-and-leaseback deal with health food chain Holland & Barrett.
Holland & Barrett has signed a 30-year leaseback on the properties subject to RPI-linked rent reviews.
Covering 433,000 sq ft, the sheds at the 200-acre Centrium 100 Business Park in Burton-upon-Trent generate £1.6m pa in rent. They were put up for sale along with the firm’s Nuneaton HQ in May with an asking price of around £30m.
The yield is one of the tightest paid in the industrial sector, with the record set in 2014 when Cargiant bought a shed in Wembley, north-west London, from Prologis at a 4.1% yield.
Holland & Barrett’s headquarters building has been stripped out of the portfolio sale to maximise the price fetched by the industrial assets. It is being marketed individually.
CBRE and Colliers International advised Holland & Barrett; Knight Frank acted for the purchaser.
Colliers International’s national capital markets director Richard Walsh said: “This disposal is another example of how our tailored sale-and-leaseback advice produces record yields for the location. We are very pleased with this result.”
