Gazeley is on the cusp of securing the biggest industrial letting since 2012 with a 900,000 sq ft prelet to Waitrose at Magna Park in Milton Keynes.
The retailer has agreed terms for a distribution warehouse with ancillary office space at a rent of around £5.75 per sq ft on a lease of 25-30 years.
The deal will allow the company to consolidate from a number of smaller locations in the Milton Keynes area.
Gazeley has submitted an application to Milton Keynes council for the development on plots 310 and 320 at the park. A decision is expected in March.
The sites boast a combined floorspace of around 900,000 sq ft over 42 acres. Infrastructure, landscaping and a new roundabout will be included.
Waitrose’s deal is the largest industrial letting since Sainsbury’s took a 1m sq ft distribution centre at Prologis’ Daventry International Rail Freight Terminal in October 2012.
It follows last year’s 670,000 sq ft prelet to John Lewis at Magna Park, which Gazeley forward sold to Aviva Investors for £74m, reflecting a 4.9% yield – a record for the shed sector.
Market sources expect a similar deal will follow the Waitrose letting. They claimed the warehouse would be valued at £110m once developed.
A source said: “This is the kind of deal we want to be seeing, a mark of confidence in the sector. The John Lewis sale was the deal of 2013. Gazeley will be hoping to replicate that, line up a forward funding partner, and close the deal of 2014.”
Savills, Jones Lang LaSalle and Burbage Realty act for Gazeley on Magna Park. Colliers International advised Waitrose.
Chris.Berkin@estatesgazette.com
