Purchase of warehouses in France & the Netherlands
5 October 2022
LEI: 213800I9IYIKKNRT3G50
abrdn European Logistics Income plc
Acquisition of warehouses in France and the Netherlands for €21.4 million
abrdn European Logistics Income plc (the "Company" or "ASLI") announces the acquisition of two logistics warehouses, in Dijon, France, and Horst, the Netherlands, for an aggregate purchase price of €21.4 million.
Constructed in 2004 and subsequently refurbished in 2021, the 5,069 sqm Dijon property sits on a total plot size of c. 27,000 sqm. Located in the municipality of Gevrey-Chambertin, just ten kilometres from Dijon on the main logistics 'backbone', the freehold asset has been acquired for €9.3 million, reflecting a net initial yield of 4.2%. The property benefits from excellent arterial connectivity, with direct access to the A39 connecting to the A31 and A36 to Lyon, providing links to the wider Alpine road network.
The building is leased to Dachser Intelligent Logistics, the German-owned global third party logistics provider founded in 1930, operating as Dachser France, on a ten year term. The lease benefits from annual French ILAT indexation, offering attractive long term income. Low site coverage provides excellent opportunities for future expansion.
Constructed in 2005, the Horst property was identified earlier in the year. It totals c. 6,900 sqm, including office space, and has been acquired for €12.1 million as part of a sale and leaseback deal with Limax, a producer, packager and distributor of soft fruits and mushrooms. Serving as its headquarters, the tenant critical asset with cold storage lies between Venlo and Venray, an area which is well known for its agrofood and agricultural businesses. It is considered the gateway to the European hinterland, close to barge and rail terminals and the A73 to Nijmegen and A67 to Antwerp/ Duisburg.
The freehold property, which covers a total land plot of c. 40,500 sqm, provides ample scope for future extensions and benefits from a ten year lease term subject to annual CPI capped indexation, with the price reflecting a net initial yield of 3.8%. It features rooftop solar panels which enhance the portfolio's sustainability credentials, in line with the Company's strategy.
Evert Castelein, Fund Manager for ASLI, commented: "These assets fit with our strict investment criteria, being excellently located with direct access to major routes and standing on large plots allowing for future expansion. The portfolio now totals 28 properties across five countries, adding further diversity to our strategy.
"Longer term leases with CPI indexation and our quality diversified asset base across Continental Europe continues to underpin the Company's strategy and should deliver shareholder value with our increasing tilt towards urban locations close to major population centres."
Loan to value
These purchases have been financed through cash reserves and expected additional asset level debt drawn with ING bank at 3.05% for a shorter three year term. This puts the Company's asset level fixed debt at €261.6 million, with the loan to value (LTV) ratio using 30 June 2022 valuations at 31%. The average cost of debt across the portfolio is now 1.98%. In addition, while SPV financings are finalised the Company will be drawn €25 million against its short term revolving credit facility leaving the total debt LTV ratio at 32.9% until repayment, following which this will fall back to c.31% to sit well within the Company's target asset level LTV of around 35%.
For further information please contact:
abrdn +44 (0) 20 7463 6000
Luke Mason
Gary Jones
Investec Bank plc +44 (0) 20 7597 4000
Denis Flanagan
David Yovichic
FTI Consulting +44 (0) 20 3727 1000
Dido Laurimore
Richard Gotla
James McEwan
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