Orchard Street has pipped Legal & General to buy SEGRO’s Orbital Portfolio of multilet sheds.
The pair went head-to-head in a bidding war that pushed the price up from the £102m sought to more than £112m.
Orbital comprises six industrial estates across London and the South East. The assets are located in Hemel Hempstead, Woodford Green, Heathrow, Frimley, West Thurrock and Camberley.
The deal highlights investors’ growing appetite for sheds.
Earlier this month, Varde Partners bought the £240m Titan portfolio, and L&G secured the £220m Ocean Portfolio, while Brockton Capital and Dunedin are buying Hansteen’s £147.7m Industrial Property Unit Trust and the £220m Partridge Portfolio.
Cushman & Wakefield partner and chief executive of UK capital markets David Erwin said: “Logistics could outperform shopping centres this year, with as much as £6bn traded, at prime yields at least on a par with shopping centres.”
SEGRO announced plans to sell £1.6bn of non-core property three years ago, including £1bn of light industrial assets and £600m of other property, including offices.
At the same time, it has been targeting larger logistics assets.
The strategy is designed to reduce the company’s exposure to manufacturing, while increasing its weight in distribution.
So far SEGRO has sold around £1.3bn of its non-core assets, reinvesting much of the capital in development projects.
DTRE acted for SEGRO; Knight Frank advised Orchard Street; JLL represented L&G.
chris.berkin@estatesgazette.com
