Tritax Big Box REIT has bought its first Amazon distribution centre in Kingston Park, Peterborough, for £42.9m – a 5.6% yield.
The purchase is being funded from equity proceeds. Senior debt finance is expected to be introduced in the near term.
The centre is one of Amazon’s major distribution centres in the UK, fulfilling general merchandise and grocery online orders throughout the UK and Europe.
It was built to a high specification in 2006, comprising offices, a secure HGV trailer park and extensive parking. It has an eaves height of 15 metres, a gross internal floor area of 549,788 sq ft and a low site cover of approximately 42%.
The property is being acquired with an unexpired lease term of 8.7 years subject to five-yearly upward-only rent reviews indexed to the consumer price index. The next rent review is due in April 2020. The passing rent is £4.50 per sq ft with a capital value cost equivalent to approximately £78 per sq ft.
Colin Godfrey, partner of Tritax, said: “Amazon has committed significant capital into its fit-out of the facility. Our portfolio now comprises 31 big-box logistics assets.
“It also diversifies our tenant and geographic mix, and offers opportunities for asset management.”
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