Stenprop has acquired a fully-let industrial estate in Shrewsbury for €3.3m (£2.9m) in line with its stated strategy to focus on UK multi-let industrial (MLI) property. The purchase from South Street Capital reflects a net initial yield of 6.7%.
Greenwood Industrial Estate is located off Cartmel Drive in the primarily industrial area of Shrewsbury, three miles north of the town centre. It comprises 30 units, totalling 44,611 ft² of industrial space. The weighted average unexpired lease term is 3.7 years to lease expires and 2.3 years to lease breaks. The average passing rent is €5.37 (£4.70)/ft².
Julian Carey, Group Property Director of Stenprop, said: “Greenwood is a purpose-built estate with an attractive mix of small units and low average rents. It is located in an area with very strong supply-demand dynamics and a number of the tenants have been in occupation for more than 20 years. We intend to make improvements to the estate through a programme of capital expenditure, which, we believe, will provide scope for rental growth, while the acquisition price of €75.5 (£66)/ft²reflects a significant discount to replacement cost”.
The estate is the sixth acquired by Stenprop since its purchase of the Industrials.co.uk portfolio for €145.2m (£127m) in June 2017. Stenprop is seeking a further €114.3m (£100m) of multi-let industrial opportunities in the UK over the course of 2018.