Warehouse REIT completes major long-term lettings
19 October 2022
Warehouse REIT completes major lettings totalling 205,000 sq ft at 24% ahead of ERVs
Warehouse REIT, the specialist urban and 'last-mile' industrial warehouse investor, has completed two long-term lettings in Plymouth and Coventry, totalling 205,000 sq ft, which will generate over £1 million of annual contracted rent. Achieved at an average 24% above ERVs and 30% above the previous passing rents, the transactions demonstrate the ongoing strength of the UK warehouse occupier market, which continues to be characterised by historically low vacancy levels.
At its modern urban warehouse in Coventry, the Company has agreed a 140,000 sq ft letting of the entire building to Evtec Aluminium Ltd, a leading automotive component manufacturer, at a rent representing a 17 % uplift on the 31 March 2022 ERV and 26% uplift on the previous passing rent. The 10-year lease with no break will generate contracted rent of £623,000 per annum, equating to circa £4.50 psf.
Coventry is well served by the M6 motorway. With Junction 3 situated four miles to the north, the town has excellent transport infrastructure to serve the Midlands and beyond, with both Birmingham City Centre and the M6/M1 motorways intersection being less than 20 miles away.
In a second transaction, Warehouse REIT has completed a 66,000 sq ft letting to leading 3PL provider Hermes Parcelnet (t/a Evri), at its central Plymouth warehouse, following a targeted capital expenditure programme. Serving as a key distribution centre in the southwest, Evri has signed a new 10-year lease with no break clause, at an annual rent of £460,000, reflecting an uplift of 36% on the previous passing rent.
Having acquired the property in 2017, Warehouse REIT commenced a £1.7 million programme of works during 2021 on expiry of the former occupier's lease. Refurbishment works included the replacement of the building's roof, the installation of new LED lighting throughout, new EV charging points, as well as extensive internal and external redecoration. The building's EPC rating was significantly improved from a D to a high B.
The warehouse benefits from its close proximity to the A38, a major arterial route connecting Cornwall in the southwest and Mansfield in the East Midlands and is just one mile from Plymouth city centre.
Paul Makin, Investment Director of Tilstone, Investment Adviser to Warehouse REIT, commented: "With strong ongoing demand for modern warehouse space in well-connected urban locations across the UK, we continue to capture the portfolio's significant reversionary potential. The Coventry transaction is another significant letting to complete in the West Midlands this year and reflects the region's chronic undersupply of ready-to-occupy warehousing.
"At the Company's Plymouth asset, our highly experienced team has delivered a modern specification warehouse in what is a severely supply constrained local market, enhancing its occupier appeal and enabling us to drive a significant rental and capital value uplift."
Commenting on the Plymouth letting, Gary Lees, Regional Asset Management Director of Tilstone,
added: "We were pleased to have agreed terms with Evri early in the refurbishment process and to be able to satisfy its occupational requirements. We look forward to building on the great relationship forged with the Evri team and will continue to look for opportunities to work together."
At Plymouth, Warehouse REIT was advised by Tim Western of JLL (agency) and Craig Keogh of Savills (Building Consultancy).
-End-
Enquiries:
Warehouse REIT plc
via FTI Consulting
Tilstone Partners Limited
Andrew Bird, Paul Makin, Peter Greenslade
+44 (0) 1244 470 090
G10 Capital Limited (part of the IQEQ Group, AIFM
Maria Glew
+44 (0) 207 397 5450
FTI Consulting (Financial PR & IR Adviser to the Company)
Dido Laurimore, Richard Gotla, Ellie Perham-Marchant
+44 (0) 7904 122207 / WarehouseReit@fticonsulting.com
Further information on Warehouse REIT is available on its website:
http://www.warehousereit.co.uk
About Warehouse REIT
Warehouse REIT plc invests in and manages urban and 'last-mile' industrial warehouse assets.
Our purpose is to own and manage warehouses in economically vibrant urban areas across the UK, providing the space our occupiers need for their businesses to thrive.
As we grow, our vision is to become the UK's warehouse provider of choice.
The Company is listed on the Main Market of the London Stock Exchange and is an alternative investment fund ("AIF") for the purposes of the AIFM Directive and as such is required to have an investment manager who is duly authorised to undertake the role of an alternative investment fund manager. The Investment Manager is currently G10 Capital Limited.
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