5 Nov 2021 07:00
INDUSTRIALS REIT LIMITED
(Formerly Stenprop Limited)
(Registered in Guernsey with registration number 64865)
LSE share code: MLI JSE share code: MLI
ISIN: GG00BFWMR296
5 November 2021
INDUSTRIALS REIT COMPLETES THREE MULTI-LET INDUSTRIAL ACQUISITIONS TOTALLING £18 MILLION *
* This announcement is to provide further information on these transactions, which were previously announced in the Industrials REIT Trading Update on 29th October 2021.
Industrials REIT, the UK multi-let industrial ("MLI") property company, has acquired three multi-let estates, as it nears its target of being a fully focused MLI REIT by 31 March 2022. The three estates, in Birkenhead, Coatbridge, and Stockton on Tees, have been purchased in separate transactions for a total consideration of £18 million, reflecting a blended net initial yield of 7.1% and a capital value of £69 per sq ft.
Junction 1 Business Park, Birkenhead has been acquired from listed property company for £10.8 million, reflecting a net initial yield 7.1% and a capital value of £64 per sq ft. The 167,735 sq ft, 26-unit estate is 100% let and generates a total annual passing rent of £822,151, which equates to a low average rent of £4.90 per sq ft. Junction 1 Business Park is the dominant commercial centre in The Wirral and has witnessed strong occupancy and 100% rent collection levels since the start of 2020, reflecting both high levels of demand and take up in the region and a shortage of MLI product.
Arkgrove Industrial Estate, Stockton on Tees has been acquired from a private seller for £4.2 million, reflecting a net initial yield of 6.5% and a capital value of £78 per sq ft. It is located immediately to the north of the A1046 Portrack Lane, in the heart of the Teesside region's prime industrial and retail warehouse hub. It comprises a terrace of 14 recently refurbished units, together with a standalone trade counter unit as well as a secure yard, and totals 54,177 sq ft. The estate, which is currently 100% let, generates an annual passing rent of £291,712, which equates to an average passing rent of £5.38 per sq ft..
Dundyvan Industrial Estate in Coatbridge has been acquired from a property company for £3.0 million, reflecting a net initial yield of 7.8% and a capital value of £75 per sq ft. The purpose-built MLI estate totals 40,067 sq ft across 29 units ranging from 600 sq ft to 3,900 sq ft and is currently 98% let. It occupies a strategic location southwest of Coatbridge Town Centre, adjacent to both the M74 and M8 motorways, and just 8.5 miles from Glasgow city centre. The estate generates a total annual passing rent of £246,680, which equates to an average rent of £6.30 per sq ft. Industrials REIT already owns five further MLI estates in Glasgow which benefit from strong local dynamics, with vacancy rates below 4% and strong rental growth.
Industrials REIT's MLI portfolio now accounts for 92% of total assets. Reflecting its deal origination and execution capabilities, the Company has now acquired 10 estates for £55 million since 1 April 2021.
Will Lutton, Head of Investment at Industrials REIT, commented: "These off-market acquisitions, which offer a mix of strong day one income and the opportunity to drive rents through our Industrials Hive operating platform, maintain the progress we have made this financial year delivering on our 100% MLI goal. All three properties offer low passing rents and attractive pricing on a per sq ft basis. With replacement costs remaining significantly below development costs and a structural shift in demand driven by growth in eCommerce, we are continuing to see an imbalance between demand and supply which is driving rental growth across our portfolio."
This announcement is voluntary and for information purposes only.
For further information:
Industrials REIT Limited +44(0)20 3918 6600
Paul Arenson (paul.arenson@industrials.co.uk)
Julian Carey (julian.carey@industrials.co.uk)
James Beaumont (james.beaumont@industrials.co.uk)
Numis Securities Limited (Financial Adviser) +44(0)20 7260 1000
Hugh Jonathan
Vicki Paine
FTI Consulting (PR Adviser) +44(0)20 3727 1000
Richard Sunderland
Richard Gotla
Neel Bose
industrialsreit@fticonsulting.com
Java Capital +27 (0)11 722 3050
(JSE Sponsor)
About Industrials REIT:
Industrials REIT is a UK REIT listed on the LSE and the JSE. The objective of the Company is to deliver sustainable growing income to its investors. Industrials REIT's investment policy is to invest in a diversified portfolio of UK multi-let industrial (MLI) properties with the strategic goal of becoming the leading MLI business in the UK. For further information, go to www.industrialsreit.com.