Business
Acquisition of Multi-Let Industrial Estate
Acquisition of Multi-Let Industrial Estate.
About this update from Schroder Real Estate Investment Trust Ltd
[{"type":"text","content":"\n \n \n For rel\n ease 17 December 2020\n \n Schroder Real Estate Investment Trust Limited\n(\"SREIT\"/ the \"Company\" / \"Group\")\n ACQUISITION OF MULTI-LET INDUSTRIAL ESTATE\n Schroder Real Estate Investment Trust, the actively managed UK-focused REIT, announces that it has exchanged unconditional contracts to acquire an industrial estate in Chippenham for £19.25 million, reflecting a net initial yield of 8.2%. This is in line with the strategy to selectively deploy available capital into income producing assets alongside planned asset management initiatives and the ongoing share buy back programme. Completion is due to take place on 18 December 2020. \n Langley Park is located in Chippenham town centre close to the railway station and four miles south of junction 17 of the M4 motorway. It is in close proximity to the cities of Bristol and Bath and serves both metropolitan areas. The estate comprises approximately 400,000 sq ft of warehouse and ancillary office accommodation on a 28 acre site, equating to a low site cover of approximately 30%. Langley Park is let to five tenants producing a total net rent of £1.68 million per annum or an average rent of £4.21 per sq ft. 100% of the rent due during the Covid-19 pandemic has been collected. The estimated market rental value is approximately £1.8 million per annum. The average unexpired lease term, assuming all tenant breaks are exercised, is four years.\n The largest tenant is Siemens Mobility Limited, representing 53% of the rental income, who employ approximately 800 people at the site. Langley Park is the global headquarters for Siemens Mobility who, through corporate acquisitions, have occupied the site for over 85 years as a facility for manufacturing and servicing rail technology and traffic systems. Siemens pay a net rent of £965,000 per annum with a lease expiry in June 2026. Other tenants include a UK subsidiary of Littlefuse Inc., a global manufacturer of power systems for the transport industry (20% of rental income), Schneider Electric Limited (11% of rental income) and NHS Property Services Limited (8% of rental income). \n The strategy is to work closely with the occupiers to align their occupation with various estate management improvements. The current low site density could enable the creation of new a...