LondonMetric has sold a 785,000 sq ft Northamptonshire warehouse to EQT Exeter for £102m.
The Thrapston shed is let to Primark for £4.4m a year, with another 11 years of the lease to run. The sale reflects a net initial yield of 4.1%.
LondonMetric bought the property in 2013 for £60.5m, at a yield of 6.4%. It has since delivered a total return of 123% and an ungeared IRR of 12%. Completion of the sale will take place in February 2022, generating an additional £2.2m of income. Total proceeds are 8% above the 31 March 2021 book value.
However, LondonMetric has no plans to sell its other 1.1m sq ft Primark warehouse in nearby Islip, which is let for a further 19 years.
The Thrapston sale will reduce LondonMetric’s weighting towards mega distribution from 13% to 10%, while Primark will account for less than 5% of its rent roll, instead of 8%.
The deal is Swedish private equity giant EQT’s first major deal since buying Exeter Property Group for $1.9bn in January.
LondonMetric chief executive Andrew Jones said: “This is a very good asset that has performed strongly, delivering a total return of £76m since acquisition. The sale price achieved reflects a very competitive bidding process and highlights the depth of demand for well let logistics assets delivering reliable, repetitive and growing income.”
LondonMetric was advised by Knight Frank. EQT Exeter was advised by DTRE.
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