Custodian REIT has acquired a 91,955ft² distribution facility between Glasgow and Edinburgh for €12.8m (£11.125m), reflecting a net initial yield of 5.25%. The property benefits from a strategic logistics location on the Eurocentral industrial estate, at Junction 7 of the M8, 15 miles from Glasgow and 35 miles from Edinburgh. The asset is fully let to Gist, a national distribution business, with five years remaining on the lease and three years to a break option, and producing a passing rent of €720,066 (£623,160) per annum. This acquisition increases the industrial weighting within the company’s highly diversified portfolio of 165 properties to 48% by value.
Richard Shepherd-Cross, Managing Director of Custodian Capital Limited (the Company’s discretionary investment manager), commented: “This well located, modern industrial asset has been acquired off-market at an attractive net initial yield of 5.25%. We see scope to significantly increase the rental intake of this conservatively let asset based on recent local comparables combined with strong occupational demand, meaning we expect the reversionary yield on purchase price to move towards circa 7%. This purchase highlights the yield advantage offered by the Company’s smaller regional property strategy of acquiring strong and secure assets with the potential for future income and valuation growth.”
