Urban Logistics is acquiring a store in Edinburgh leased to The Range, as one of two purchases totalling £21.7m.
The acquisitions represent a combined 6.14% net initial yield.
The seven-acre Edinburgh property, in Milton Link, comprises a 75,478 sq ft The Range retail warehouse and a 1,845 sq ft Costa Coffee drive-thru. The firm has exchanged contracts to buy it for £13.2m, at a 6.2% net initial yield.
The rent for the store is £10.51 per sq ft and it is let through to 2033 with five-yearly rent reviews. The drive-thru generates rent of £40.65 per sq ft and is let through to 2034.
Urban Logistics said it bought the retail property for its reversionary long-term income and asset management potential.
The REIT has also bought a 110,859 sq ft distribution centre in Warrington, for £8.5m at a 6.05% NIY. It is let to Mark Thompson Transport, part of Kinaxia Logistics, until 2030.
The rent is £4.94 per sq ft and there is an open-market rent review in 2025.
Chief executive Richard Moffitt said: “In line with our strategic focus of value enhancement, both assets offer asset management opportunities in the short to medium term given the low passing rents.”
Urban Logistics collected 99% of rent due for the quarter to June, with the remainder expected to be collected “imminently”.
M1 Agency advised on the deal.
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