Invesco Real Estate has partnered with Barwood Capital to refurbish and develop c. 46,452m2 of logistics facilities in Birmingham. The company has acquired two existing industrial units with plans to extend and refurbish them to meet Grade A institutional standards with excellent ESG (environmental, social, and governance) credentials. Additionally, they have acquired a 2.59-ha vacant site adjacent to the existing units, with intentions to construct additional units on the site.
These acquisitions were made on behalf of one of Invesco Real Estate's long-standing separate account clients, with Barwood Capital serving as the development manager for the combined scheme.
The site is situated in the prime industrial submarket of Birmingham within the Midlands' primary 'Golden Triangle' logistics hub, which is one of the UK's main distribution centres catering to the Birmingham, pan-Midlands, and wider UK markets. This location offers strong rental growth prospects and excellent occupational demand.
The current on-site facilities consist of two freehold warehouse units constructed in 2015 to modern, institutional specification criteria and currently rated EPC A. Additional ESG initiatives will be implemented to enhance overall sustainability credentials with a target to achieve BREEAM 'Excellent'. Furthermore, two additional units ranging from 5,574m2 to 8,361m2 will be developed on the adjacent 2.59-ha vacant site.
Rob Johnston, Managing Director –UK & Nordics Investments at Invesco Real Estate, said: “Despite the occupational uncertainty of the past two years, the UK remains relatively undersupplied in terms of modern, institutional grade accommodation. The acquisition of standing units provides the opportunity to deliver an attractive spread in terms of yield-on-cost vs prime Midlands logistics yields with reduced development exposure. In addition, the marriage value from combining the adjacent vacant site will further consolidate this as a prime scheme. Birmingham is at the centre of the highly attractive Midlands economic region, and we are excited to work with Barwood Capital on this initiative.”
Jonathon Ellerington, Senior Investment Manager at Barwood, said: “Given the quality of the existing units, coupled with the excellent opportunity to speculatively develop further in this premier logistics location, we are thrilled to complete these acquisitions and develop this scheme with Invesco Real Estate. This is a location with proven occupational demand for sustainable and well-located logistics units, and the refurbishment and redevelopment of these sites will serve to improve the area while providing exceptional industrial space at a time when the market is starved of supply.”
The letting agents are Knight Frank, Colliers, and Cushman and Wakefield. Invesco Real Estate were advised on the acquisitions by Knight Frank.
Image provided by Citigate Dewe Rogerson.
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