INTERNATIONAL - Stenprop, the UK multi-let industrial property investor, announced that it had acquired Estuary Court from Storage Giant for £3.1million (R54.28m), which reflected a net initial yield of 7.6percent.
Estuary Court is an industrial estate located in Newport, South Wales, and is a modern estate, located in the established industrial location of Queensway Meadows.
The group said Estuary Court comprised 20 units, totalling 3250m² of industrial and trade counter space, and was fully let to 17 tenants, including Clark Foods, Thrifty, Europcar, Rearo Laminates and Halo Foods.
The group said the weighted average unexpired lease term was 4.3years to lease expiries and 3.5years to lease breaks.
Julian Carey, executive property director of Stenprop, said Estuary Court was an excellent addition to the group’s portfolio.
“It is well placed to capitalise on growing demand for industrial accommodation as a result of the removal of bridge tolls across the River Severn later this year,” Carey said.
The total annual passing rent of £251493 equates to an average rent of £75.57 a square metre.
Stenprop said that it had taken the strategic decision that its objective to deliver sustainable, growing income to shareholders was best achieved by becoming a specialised UK multi-let industrial (MLI) property company.
“This strategic repositioning means that Stenprop intends, over the next few years, to sell all, or substantially all, of its non-MLI assets and utilise the sale proceeds to build a focused UK MLI business,” the group said.
The group added that following the acquisition of Estuary Court, MLI assets accounted for 22.9percent of Stenprop’s portfolio.
The group expects its MLI assets to comprise about 60percent to 65percent of Stenprop’s total portfolio of properties by March 31, 2020.
Stenprop moved its jurisdiction of incorporation from Bermuda to Guernsey on March 23 and converted to a UK real estate investment trust on May 1. In the results for the year to March, the group declared a final dividend of 4pence a share.
This, together with the interim dividend of 4p a share in November, resulted in a total dividend of 8p a share.
The group added this equated to a historic dividend yield of 7percent on the share price of £1.14 at June 4 or 5.7percent on the diluted European Public Real Estate Association net asset value of £1.41 at the end of March.
The group made a total investment of £147.8m in MLI assets at the end of March, including the £130.5m strategic acquisition of the industrials.co.uk portfolio and management platform.