Oxenwood Real Estate, the UK and European real estate investment management firm, has acquired four last-mile logistics properties in the UK for £51 mln (€60 mln).
The facilities in London, Redhill and Manchester have been acquired in four separate transactions from a mix of private and institutional investors by Oxenwood Catalina, Oxenwood’s joint venture with Catalina Holdings. They have very good connectivity to the motorway network and are let at below-market rents, which gives Oxenwood the opportunity to add 'significant' value, the company said in a statement.
The acquisitions increase Oxenwood’s investment in logistics to £183 mln, since the company announced in March the repositioning of the business with a £200 mln increase in capital from the its long-time investment partner, Bermuda-based Catalina Holdings, to take advantage of opportunities arising in the UK and European logistics markets. The capital included the reinvestment of around £100 mln from the sale of Oxenwood Catalina’s portfolio of UK logistics properties to Ascendas Reit in 2018 and an additional £100 mln commitment.
In London, Oxenwood has acquired a facility in Barking, east London, and another in west London for a total of £27.1 mln. In Barking, the 38,929 sq ft (3,623 m2) facility in Gascoigne Road, 25 minutes from the City of London, is let to Best Selling, a cash-and-carry business, until July 2027, with a tenant-only break option in July 2022.
In Redhill, Oxenwood has acquired a 108,193 sq ft facility on Bonehurst Road for £17.25 mln, which reflects a net initial yield of 4.81%. It is let to DHL Supply Chain until October 2023. In Manchester, Oxenwood has acquired a 90,740 sq ft office, laboratory and warehouse facility on Beacon Road in Trafford Park for £7 mln, which reflects a net initial yield of 6.45%. It is let to Houghton, the UK subsidiary of Quaker Houghton, the global leader in industrial process fluids, until 2031, with a break option in 2021.
Stewart Little, co-founder of Oxenwood, said: 'Urban locations continue to be a focus for the business, and these four additions represent excellent value-add opportunities in their markets. With lease structures that allow us to access the strong rental growth in their locations, the assets will be strong contributors to the portfolio.'