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(Sharecast News) - Property investor Urban Logistics issued a positive trading update following the close of its interim period ended 30 September on Monday, reporting 99.4% occupancy across 91 logistics properties.
The AIM-traded real estate investment trust said rent collection was over 99% for the half-year, adding that it had deployed or committed capital from its July fundraising across eight transactions for consideration of £103m, at a 5.5% weighted net initial yield.
Around £50m of further investments were in "advanced stages" of contractual progress, and were expected to be completed in the near term at a weighted average 6.2% net initial yield.
A new pipeline of over £400m of high-quality logistics properties was identified, using the company's extensive proprietary network to source off-market deals.
Looking at its asset management, Urban Logistics said it had completed 15 new lease events across the portfolio, totalling 813,939 square feet, generating an uplift of £1.6m in contracted rent.
Those events comprised 11 new lettings, three regears, and an open market rent review.
The company said the Unipart Group, part of a logistics contractor for the NHS, had extended its existing lease for the 136,383 square foot property they occupy in Alfreton, north of Nottingham, for an additional 10-year period.
It said the rent rose 18%, from £593,250 to £700,000, or £5.12 per square foot.
An open market rent review was completed with Meritor Aftermarket UK for the 26,179 square foot property they occupy in Redditch, just south of Birmingham.
The rental rate increased from £117,806, or £4.50 per square foot, to £138,749, or £5.30 per square foot, making for an increase of 17.8%.
Anglian Water has signed a new 15-year lease for £340,011, or £7.39 per square foot, on a property which the company acquired through a forward funding agreement.
The property, near Peterborough, comprises a 46,000 square foot unit with a 60-bay car park, with the work there completed on time and ahead of budget.
Wincanton, meanwhile, signed a new 15-year lease for a 132,487 square foot unit in Paisley, near Glasgow.
The building was purchased a year ago, with the lease in place at the time extended on a short-term basis before the unit was substantially refurbished.
The agreed rent was £828,044, or £6.25 per square foot, up 13.7% from the previous recognised rent of £727,986 or £5.28 per square foot.
"The logistics real estate sector continues to enjoy very positive market conditions in recent months with an ongoing supply and demand imbalance for suitable properties," said chief executive officer Richard Moffitt.
"We remain highly focused on our last mile, or last touch, strategy, where we have built a market leading position.
"Last mile logistics assets play a crucial role in the supply chains of our tenants demonstrated by our occupancy figures of 99.4%."
Moffitt said the company's activity in the sector was underpinned by a focus on acquiring "high-quality, well-located" assets let to "robust counterparties", as demonstrated by its recent rent collection figures, in excess of 99% for the past half year.
"Going forward, we will continue to focus on active asset management to drive capital value creation in the existing portfolio, while our reputation as a reliable and well known counterparty continues to create opportunities in accessing attractive off market deals at compelling valuations.
"Following the successful deployment of the considerable capital raised to date as an AIM company, we have created a major portfolio of 91 last mile assets, secured at an attractive blended net initial yield entry valuation."
After continued dialogue with shareholders, Richard Moffitt said the board believed that a main market listing would be the most effective platform to further grow and diversify the shareholder register and the asset base.
"We look forward to further updating shareholders on our plans shortly."
At 0925 BST, shares in Urban Logistics REIT were down 0.15% at 169.75p.
17 Apr 2024 09:37
Urban Logistics hails strong portfolio amid new lettings
(Alliance News) - Urban Logistics REIT PLC on Wednesday reported that it saw continued progress in the fourth quarter of its financial year, which it said was marked by significant like-for-like rental increases and a number of new lettings.
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