Custodian REIT (LSE: CREI), the UK property investment company, is pleased to announce two further property purchases.
The Company has acquired a 19,730 sq ft Audi car dealership on Battlefield Enterprise Park, Shrewsbury’s premier motor retail location four miles from the town centre and five miles from the busy A6, linking Shrewsbury to the West Midlands. The unit is occupied by Lancaster plc, part of the Jardine Motors Group, with nearby occupiers including Volkswagen, BMW, Mercedes-Benz, Renault, and Ford.
The Company also acquired a 23,691 sq ft Audi car dealership in Stafford, two miles from the town centre and within a mile of junction 13 of the M6. The unit is occupied by Swansway Garages, a top-30 franchised motor dealership, with nearby occupiers including Land Rover, Nissan and Arnold Clark.
Both properties are let to VW Group UK Limited on leases expiring on 20 December 2024, with current annual passing rent of £197,996 and £305,000 respectively.
The agreed aggregate purchase price of £7.375 million reflects a net initial yield1 of 6.38%. The transaction was funded from the Company’s existing debt resources, resulting in net gearing2 increasing to 22.0% loan to value.
Commenting on the acquisitions, Richard Shepherd-Cross, Managing Director of Custodian Capital Limited (the Company’s discretionary investment manager), said:
“We are delighted to have secured these two well-established properties located within the prime motor retail pitches of their respective locations. Both are let to one of the UK’s largest motor retailers and occupied by strong franchised dealers on long-term leases.”
1 Passing rent divided by valuation plus estimated purchasers’ costs.
2 Gross borrowings less unrestricted cash divided by last published property portfolio valuation.