Custodian REIT (LSE: CREI), the UK property investment company, is pleased to announce a further property purchase.
The Company has acquired a 53,198 sq ft distribution unit within Bellshill Industrial Estate, Bellshill located 10 miles east of Glasgow with access to junction 7 of the M8 and junction 5 of the M74. Nearby occupiers include Screwfix, DHL, Scania and TNT.
The unit is let to Yodel Delivery Network Limited on a lease expiring on 1 August 2025 with current passing rent of £275,000 reflecting a net initial yield1 of 6.94%.
The agreed purchase price of £3.72 million was funded from the Company’s existing debt facilities, resulting in net gearing2 increasing to 21.8% loan to value.
Commenting on the acquisition, Richard Shepherd-Cross, Managing Director of Custodian Capital Limited (the Company’s discretionary investment manager), said:
“We are delighted to have secured this purpose-built parcel delivery depot on one of Scotland’s prime distribution parks, let to a market leading operator. The tenant has recently carried out significant works on the property, demonstrating its commitment to the location, and we expect to crystallise rental growth at the next review.”
1 Passing rent divided by purchase price plus assumed purchasers’ costs.
2 Gross borrowings less unrestricted cash divided by last published property portfolio valuation.