Tritax Big Box REIT is buying a Kellogg’s distribution facility at Trafford Park, Manchester, for £23.5m.
The 311,602 sq ft building has been bought from Kellogg’s, which has another 1.75 years remaining on its lease, and has a passing rent of £4.50 per sq ft. The sale price reflects a 5.9% yield.
The purchase will be funded using equity, and senior debt is expected to be “introduced in the near term”.
Colin Godfrey, partner at Tritax, said: “Trafford Park is a prime logistics location where we already own the L’Oréal distribution facility. The initial yield is accretive to our portfolio running yield and the short unexpired lease term presents an opportunity for value enhancement. This investment is highly reversionary, providing the potential for significant rental uplift upon re-letting or lease regear.”
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