SEGRO plc announces the disposal of a portfolio of six UK industrial estates to Orchard Street Investment Management for £113.8 mln (approx. €143.9 mln).
The portfolio generates a passing rent of £6.4 mln (approx. €8.1 mln), rising to £7.4 mln (approx. €9.3 mln), on expiry of rent-free periods and allowing for rent guarantees. The price reflects a premium in excess of 10% compared to book value at 30 June 2014.
The portfolio comprises six multi-let industrial estates located around the M25 and M3 motorways with a combined floor-space of 94,493 m², spread across 97 units. The portfolio’s vacancy rate is approximately 9%.
Phil Redding, SEGRO's Chief Investment Officer, said: “This disposal marks another important milestone as we continue to reshape our portfolio, leaving the UK non-core asset disposal program virtually complete. The proceeds of this transaction will be used to reduce our net debt in the short term and will help fund our accretive UK and Continental European development pipeline which should generate a fully-let yield on development cost of over 9%.”
Source: FTI Consulting