Warehouse REIT has acquired a 500,000 sq ft logistics site let to Amazon, for £57.3m.
The REIT acquired the property just off the M1 outside Chesterfield from Tritax Big Box. It is let to Amazon on a full repairing and insuring lease with more than 13 years remaining.
The price implies a 4.1% yield and a 5% premium to book value at 30 June. The sale reflects an IRR of 18.5% for Tritax Big Box, which will reinvest proceeds in longer dated income with 6-8% target yields.
Amazon is now Warehouse REIT’s largest tenant and pays £4m in rent per annum.
The company has also announced that it bought a 374,000 sq ft warehouse at Midpoint 18 in Middlewich, Cheshire for £25m last year. The property is let to third party logistics operator Wincanton Holdings and has 3.5 years remaining on the lease and a passing rent of £5 per sq ft.
The combined purchase prices for the two deals reflect a blended net initial yield of 5.4% and the leases have a WAULT of nine years.
The latest acquisition follows the REIT’s recent £153m equity raise, giving it £200m to invest.
Andrew Bird, managing director of Tilstone Partners, which advises Warehouse REIT, said the acquisitions “show good progress with Warehouse REIT deploying the proceeds raised into high-quality e-commerce-focused assets, both identified as part of the fundraise pipeline”.
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