Business
Acquisition of high yielding mixed-use office
Acquisition of high yielding mixed-use office.
About this update from Aew Uk Reit Plc
[{"type":"text","content":"\n\n08 September 2023\n \nAEW UK REIT plc\n \nAcquisition of high yielding mixed-use office in Bath\n \nAEW UK REIT plc (LSE: AEWU) (\"AEWU\" or the \"Company\") is pleased to announce that it has completed the purchase of a freehold, mixed-use asset in Bath city centre for £11,500,000, reflecting an attractive net initial yield of 8.0% and a capital value of £223 per sq ft. Following this acquisition, the Company is close to full deployment, with remaining cash available to invest of circa £3m.\n \nThe property comprises a rare freehold island site totalling circa 0.4 acres and is located immediately adjacent to the South Gate Shopping Centre which forms part of the city's core retail provision. Bath Spa Train Station is less than a five minute walk from the property, with other key tourist attractions such as Bath Cathedral, the Roman Baths and Pulteney Bridge within a short distance.\nThe 51,632 sq ft asset is multi-let to five tenants across office and retail accommodation. The majority of the building is let to four office tenants at a low average passing rent of circa £22 per sq ft. Income levels are expected to improve via rent reviews in the short-term and through lease renewals and re-lettings over the medium-term. Light refurbishment may also be considered in order to fully capitalise on the building's prime location and prominence. A vacant retail unit, fronting Philip Street and Ham Gardens, is currently under offer to an established local retailer. We expect market conditions to remain favourable in this location given the low level of available and consented supply, coupled with strong demand for well-specified and well-located accommodation.\n \nCommenting on the purchase, Laura Elkin, Portfolio Manager of AEW UK REIT said, \"We are pleased to have purchased this very well-located, mixed-use asset at a day one yield that will be accretive to the Company's earnings and brings the REIT one step closer to full deployment, with just £3m left to invest. Completion of the acquisition continues the strategic reinvestment of capital generated from recent sales into higher yielding assets in core urban locations.\"\n \nENDS\n \n\n\n\nEnquiries\n\n\n\n\n\n\n\nAEW UK\n\n\n\n\n\n\n\nLaura Elkin\n\n\[email protected]\n\n\n\n\n\n\n\n+44(0) 791...