The UK property investment company has acquired a 77,242sq feet health and business centre, prominently located on the A46 within a leading mixed-use, out-of-town scheme with businesses in the immediate vicinity including Ibis Hotel, Fayre&Square and Frankie&Benny’s.
Custodian REIT said the unit is let to Total Fitness Health Clubs Limited on a lease expiring on 22 June 2040, subject to a tenant-only break on 22 June 2035. Current passing rent is £350,000 per annum, reflecting a net initial yield of 7.64%.
The company said the agreed purchase price of £4.3mln was funded from its existing debt resources, resulting in net gearing increasing to 22.4% loan to value.
Richard Shepherd-Cross, managing director of the company, said: “We are delighted to have acquired this high specification, purpose-built health and fitness centre in an established and prominent location with an unexpired lease term to first break of 17 years.”
He added: “The tenant has recently undertaken an extensive internal refurbishment, highlighting its confidence in the continued performance of the location.”