Proactive Investors - Run By Investors For Investors

Custodian REIT snaps up Jubilee Close retail park in Weymouth

The property investment trust said it had acquired the park, which comprises three units occupied by B&Q, Halfords and Sports Direct, for £10.8mln
B&Q store
One of the three units of the park is occupied by DIY retailer B&Q

Custodian REIT PLC (LON:CREI) has purchased Jubilee Close, a 44,844 square foot retail Park in Weymouth.

The property investment trust said it had acquired the Park, which comprises three units occupied by B&Q, Halfords and Sports Direct, for £10.8mln.

READ: Custodian REIT acquires Evesham Shopping Park

The three units have a weighted average unexpired lease term to first break or expiry of 7.8 years and an aggregate passing rent of £803,000 reflecting a net initial yield of 6.97%.

The purchase was funded by the company’s existing debt resources, resulting in a rise in net gearing to 25.5% loan to value.

Richard Shepherd-Cross, managing director of Custodian Capital Limited, the company’s discretionary investment manager, said despite the investment market’s “aversion to the retail sector”, the company believed the occupiers of the units would “continue to prosper despite challenges from online sales”.

He added that with nearly 8 years of contractual income, strong trading performances and a 7% initial yield, the property met the group’s investment criteria.

"We believe well-located retail warehouse properties which either do not compete with online retailing or are complementary, through offering easy click and collect services, will remain in demand despite the current restructuring of the retail market."

The purchase follows the acquisition of Evesham Shopping Park, a 43,000 sq ft shopping centre, in November for £14.2mln which carried a net initial yield of 6.04%.

In early trading Tuesday, Custodian's shares were up 0.2% at 115.4p.

View full CREI profile View Profile

Custodian REIT Timeline

CN Research
January 29 2019

Related Articles

Belvoir
February 08 2019
Belvoir has expanded its operations in mortgages to provide an alternative source of income
Doctors
March 18 2019
Analysts at Peel Hunt said: “The enlarged vehicle now delivers a very durable income proposition underpinned by a Government covenant and sector-leading income efficiency”
care
March 29 2019
Chief executive Joe McTaggart said the company has a strong pipeline of projects for 2019 that are expected to deliver “good results”.
Copyright © Proactiveinvestors.com, 2019. All Rights Reserved - Proactive Investors North America Inc., Proactive Investors LLC

Market Indices, Commodities and Regulatory News Headlines copyright © Morningstar. Data delayed 15 minutes unless otherwise indicated. Terms of use