Global real estate investment management advisor BentallGreenOak has paid a price of $415 mln (€345 mln) for a portfolio of seven modern logistics assets in the UK Midlands from a joint venture of Morgan Stanley Real Estate Investing and Thor Equities.
The purchase price reflected a stabilised yield of more than 5.25% and a net initial yield of 4.32%.
Thor and MSREI only held the portfolio for 14 months before taking advantage of the strong demand for well let assets in the industrial sector. Thor partnered with a fund advised by MSREI to acquire what was then called the Tudor Portfolio from Segro for $329 mln in 2019.
The portfolio is comprised of seven stand-alone big box warehouses totalling some 202,213 m2 of space which is currently 81% leased to major tenants such as DHL, Sainsburys, British Gas, DSV and Clipper.
The portfolio’s assets are located in DIRFT, Daventry; Grove Park, Leicester; The Duke, Burton-on-Trent; Magna Park, Lutterworth; Warth Park, Raunds; Rye Park, Hoddesdon and Hams Hall, Coleshill. Tenants in the portfolio include DHL, British Gas, Clipper Logistics, Sainsburys, Beko and DSV. The only vacant asset in the portfolio, MP411, has been newly refurbished and is located in Magna Park, Europe’s largest dedicated logistics park.
The current passing rent of the portfolio is £10.6 mln per annum with an unexpired lease term to break of 4.7 years and expiry 5.5 years.
BentallGreenOak said that the acquisition continued its strategy of acquiring or developing high quality logistics assets in core, proven locations that are likely to benefit from the continued growth in occupational demand, fuelled by further ecommerce activity.
‘We were fortunate to have exchanged on this transaction at the height of demand for well-located industrial and logistic assets in major European markets to support the rising e-commerce demand for the region,’ said Joe Sitt, chairman of Thor Equities Group. ‘We believe the portfolio’s location as well as its unique tenant mix make this a highly desirable portfolio in the UK industrial market.’
The transaction is expected to complete in March.