LondonMetric Property Plc (“LondonMetric” or the “Company”) announced that it has exchanged contracts for the off-market acquisition of the Dixons Retail distribution center in Newark for £68.5 (€87 million) million, reflecting a net initial yield of 6.4%. The acquisition is from a private investor and will be funded from the Company’s existing resources.
The 726,200 ft² (67.447 m²) asset was purpose built for Dixons Carphone in 2006 and is situated on the intersection of the A1, A17 and A46 dual carriageways.
The unit is let at a rent of £4.5 million per annum with five yearly fixed uplifts to 3.0% pa compounded, and has an unexpired lease term of 18.8 years.
The unit and an adjacent 750,000 ft² (69.677 m²) distribution center serve as Dixons Carphone’s central distribution hub for both its physical stores and online business.
Andrew Jones, Chief Executive of LondonMetric, commented: “The purchase of this prime distribution center further reinforces our leading position within the retail distribution sector and extends our longstanding relationship with Dixons Carphone, who is already one of our key customers within our retail warehouse portfolio.
“The retail distribution sector is becoming an ever more critical element of the retail space and we intend to continue with our strategic focus of expanding our investment into this growth sector in tandem with deepening our strong retailer relationships.”