LONDON (Alliance News) - Highcroft Investments PLC on Wednesday said it has completed the GBP4.7 million freehold interest purchase of a retail warehouse and gym in Ipswich, England.
The property acquisition from Huron Properties Ltd was funded using existing debt facilities and the GBP4.7 million represents a 7.04% net yield. The property is comprised of two detached buildings with a combined 43,738 square footage, including a swimming pool and motorcycle showroom.
The pool is let to Dave Whelan Sports Ltd until September 2035 and the showroom to Orwell Motorcycles Ltd until September 2026. The total income on the property is GBP347,557 per annum, rising to GBP386,769 per annum in September 2020 as a result of a fixed increase, with further fixed increases in 2021, 2025, and 2030.
Highcroft Investments Chief Executive Simon Gill said: "This investment provides a good long-term income stream with fixed increases throughout the term. It provides an attractive yield for our shareholders of over 7%, which is due to increase to a minimum of 7.8% in September next year. The gym services a large residential development which adjoins the subject site, as well as other areas of the town. We continue to look for other commercial investments with long-term income streams and prospects for future enhancement."
Shares in the real estate investment trust closed 2.7% lower at 871.00 pence each.