£15 million of logistics assets at a NIY of 6.0%
Urban Logistics REIT plc
("Urban Logistics" or the "Company")
Urban Logistics acquires £15 million of logistics assets at a NIY of 6.0%
Urban Logistics, (AIM: SHED) the specialist UK logistics REIT, is pleased to announce the acquisition of two assets for a total consideration of £15.1 million at a 6.0% net initial yield (NIY). The assets include one income producing asset providing immediate additional revenue, and a forward funding development project. Circa. £50 million of further investments are in advanced stages of contractual progress and are expected to be completed in the near term at a 6.2% NIY.
This announcement means that Urban Logistics has committed or deployed £103 million of capital following its July equity raise.
Richard Moffitt, Chief Executive, commented:
"We are delighted to announce these latest acquisitions, which once again demonstrate our team's expertise and deep sector knowledge in successfully acquiring high quality assets in off-market transactions at an attractive blended net initial yield of 6.0%. The acquisitions fit into our strategy to acquire medium sized last mile assets with excellent transport links in areas with strong demand, attracting robust tenants.
As anticipated, we continue to see strong market fundamentals and significant opportunities to provide additional value for shareholders through our active asset management approach."
The Acquisitions
Golborne
The Company has entered into an agreement to forward fund the redevelopment of a site in Golborne, near Manchester. This will be a full redevelopment of an existing logistics property, once completed resulting in a new building of 120,750 sq. ft. The new building will be an EPC A rated and the development will be BREEAM rated 'excellent'. The Company will spend a maximum of £13.3 million, with an expected NIY on cost of 6.2%. The Company is actively pursuing an attractive pre-let opportunity.
Letchworth
Acquisition of a 13,724 sq. ft. property near Letchworth Garden City. The property consists of two recently refurbished buildings let to Eurocell Building Plastics Ltd and Toolstation Ltd. It was purchased for £1.8 million at a NIY of 4.9%. There is an outstanding rent review on one building providing immediate asset management opportunities.
M1 Agency Fees
The Company has incurred, on an arm's length basis, commercial agency fees from M1 Agency LLP of £150,800 in relation to the Letchworth and Golborne acquisitions. M1 Agency LLP is a partnership in which Richard Moffitt is a designated member. In accordance with Rule 16 of the AIM Rules, fees payable in respect of the acquisitions have been aggregated with all fees previously paid to M1 Agency LLP since 7 April 2021, being the date of the Company's last related party disclosure and associated fairness opinion, in respect of M1 Agency LLP. These aggregated fees total £1,377,000 and are therefore considered a related party transaction for the purposes of the AIM Rules.
The independent Directors, having consulted with Singer Capital Markets Advisory LLP, consider the terms of the related party transaction are fair and reasonable insofar as the Company's shareholders are concerned.
- Ends -
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Urban Logistics REIT plc Richard Moffitt
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+44 (0)20 7591 1600 |
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Buchanan Helen Tarbet Henry Wilson George Beale
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+44 (0)20 7466 5000 +44 (0) 7872 604453 +44 (0) 7788 528143 +44 (0) 7450 295099 |
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Singer Capital Markets - Nominated Adviser and Broker James Maxwell / Alaina Wong (Corporate Finance) Alan Geeves / James Waterlow / Sam Greatrex (Sales)
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+44 (0)20 7496 3000 |
About Urban Logistics REIT
Urban Logistics REIT plc is a property investment company, quoted on the AIM market of the London Stock Exchange, (AIM: SHED).
The Company has been established to invest in UK-based logistics properties with the objective of generating attractive dividends and capital returns for its shareholders. Its investment strategy focuses on strategically located smaller single let properties servicing high-quality tenants. Investment returns will be generated by an experienced management team focusing on quality stock selection and active asset management.
A number of structural and commercial factors currently support the attractive opportunity in the last mile/regional industrial and logistics real estate sub-sectors targeted by the Company, including: strong occupier demand, (driven by the growth of e-commerce and investment by retailers in their associated supply chain) and a decline in the supply of smaller sized lettable space in industrial and logistics real estate across the UK.
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