LondonMetric Property has exchanged contracts with Marshall Construction’s CDP to purchase and forward fund a 524,000 sq ft retail shed in Wakefield for £39.4m – a 6.3% yield.
The warehouse, on a 30-acre site near junction 31 of the M62, has been prelet to Poundworld Retail on a 15-year lease at a rent of £2.5m pa, equating to £4.85 per sq ft. The lease is subject to five-yearly compounded RPI rent reviews to a minimum of 2.5% pa and a maximum of 5% pa.
Construction is to commence later this summer with practical completion targeted for autumn 2016.
LondonMetric chief executive Andrew Jones said: “As our two existing distribution developments near practical completion, this acquisition replenishes our near-term development portfolio and extends our currently committed and pipeline developments to around 3.5m sq ft.
“The development is well located, will provide significant warehouse space, benefits from attractive contractual uplifts and is prelet to an expanding retailer with which we already enjoy a strong relationship.”
Poundworld Retail property director Mark Ward said: “We have a rapid store expansion programme over the next three years and the new distribution centre will aid our expansion plans, improve efficiency and allow for a broadening of our product range in our single and multi-price format stores.
“We look forward to partnering with LondonMetric whom we have known for a number of years, as we bring further jobs and prosperity to the Yorkshire region.”
LondonMetric was advised by JLL.
