Schroder Real Estate Investment Trust Limited (the 'Company') today announces that it has simultaneously exchanged and completed the disposal of The Gate Centre in Brentford and Kingsland Trading Estate in Bristol for a combined price of £16.77 million (approx. 20 million). The sale price compares to a value as at June 30, 2012 of £16 million, reflecting a premium to valuation of £0.77 million or 4.8%.
The apportioned price for The Gate Centre, an 82,000 ft² (approx. 7,617 m²) multi-let industrial estate in Brentford, was £12.7 million (approx. 16 million), reflecting a net initial yield of 4.9%.
This compared to a value as at June 30, 2012 of £12 million. Recent lettings following refurbishment mean that the property now produces rental income of £0.67 million per annum, increasing to £0.81 million per annum by 2015 as rent-free periods expire. The average unexpired lease term is 6.9 years.
The apportioned price for Kingsland Trading Estate, an 84,000 ft² (approx. 7,803 m²) multi-let industrial estate in Bristol, was £4.07 million (approx. 5.11 million), reflecting a net initial yield of 6.7%.
This compared to a value as at June 30, 2012 of £4 million. Following a recent letting of 52% of the estate by area and other asset management activity, the property now produces rental of £0.29 million per annum, which will increase to £0.38 million per annum by 2015 as rent-free periods expire. The average unexpired lease term for the property is 6.7 years.
Finally, as previously announced on June 22, 2012, the Company has completed the disposal of the trade counter unit at Solent Road Industrial Estate in Havant for £3.17 million (approx. 4 million). The property produces rental income of £0.16 million per annum, reflecting a net initial yield of 4.8%.
These disposals crystallize value created by active management and repositioning of the assets. This has been a core characteristic of the management team's approach and importantly provides for outcomes where sales can be achieved above the level of independent valuations.
Source: FTI Consulting