LondonMetric Property has exchanged on the sale of its freehold Odeon Multiplex Cinema in Taunton for £9.1m, to Asda Pension Fund reflecting a net initial yield of 5.5%. The property will form part of a portfolio managed by OLIM Property.
The eight screen, 2,508m2 (27,000ft2) cinema is let to Odeon Cinemas Ltd for a remaining term of 22 years. The rent rises annually in line with RPI between 1% and 5%.
The property formed part of a portfolio of ten Odeon Multiplex Cinemas acquired by LondonMetric in November 2013 at an overall net initial yield of 7.2%. It continues to own six Odeon cinemas and one VUE cinema with an average lease length of 22 years.
Andrew Jones, chief executive of LondonMetric, commented: “Since acquisition, this asset has generated a strong income return and benefitted from yield compression as demand increasingly focusses on long and predictable income.
“It has been an excellent investment providing inflation linked income growth let to a strong covenant in a market that continues to strengthen on the back of an impressive film slate.”
