Legal & General Property announces that it has acquired the freehold interest of a distribution warehouse, City Link Parcel Hub, Siskin Parkway, Middlemarch, in Coventry, from Liverpool Victoria Friendly Society, for £8.6 million (approx. €9.4 million), representing a net initial yield of 8.27%.
Purchased on behalf of the Managed Fund, the distribution warehouse unit forms part of Middlemarch Business Park, a 110-acre mixed-use distribution hub located directly to the south of Coventry Airport and in close proximity to the core of the national motorway network. It is let to City Link for a further 15.75 years at a rent of £752,475.
Charlie Walker, Senior Fund Manager, commented: "We see value and opportunity in the logistics sector but stock selection remains as critical as understanding occupational requirements and how this will change in the future.
"Consolidation centers are an increasing growth area driven by the significant volumes of internet shopping, the demand for faster throughput, as well as the need for efficient delivery to congested town centers.
"The acquisition of the Citilink Hub in Coventry not only provides a high yield and long dated income but also access to the consolidation sector where we expect to see rental growth."
M3 advised LGP on the acquisition and BNP Paribas Real Estate acted for the vendor.