Custodian REIT (LSE: CREI), the UK property investment company, is pleased to announce the disposal of a property from its portfolio.
The Company has sold a 24,582 sq ft car dealership on Mobberley Road, Knutsford for £7.0 million, £0.72 million (11.5%) ahead of the last valuation at 31 December 2016, representing a net initial yield of 4.92%. The property is let to R Stratton & Co Limited on a lease expiring in 2058, subject to break options in 2028, 2038 and 2048.
The property was purchased for £5.72 million as part of the initial portfolio acquired on the Company’s admission to the London Stock Exchange in 2014. The Company intends to use the proceeds from the disposal to fund acquisitions better aligned to its investment strategy.
Commenting on the disposal, Richard Shepherd-Cross, Managing Director of Custodian Capital Limited (the Company’s external fund manager), said:
“The current lack of available investment stock, coupled with strong demand, has led to valuations of this type of property showing significant increases over the last 18 months. Despite a long term lease being in place, we believe this was the right time to take advantage of market conditions and crystallise a significant valuation gain.”