LondonMetric Property PLC (LSE:LMP) (LSE:LMP) has announced plans to sell its distribution warehouse in Thrapston, Northamptonshire, for £102mln.
The 785,000 square feet warehouse is let to fast-fashion retailer Primark for another 11 years at a rent of £4.4mln per annum.
The group acquired the property in 2013 for £60.5mln, reflecting a net investment yield of 6.4%. The buyer is EQT Exeter.
Since acquisition, it has delivered a total return of 123% and an ungeared internal rate of return of 12%.
Completion of the sale will take place in February 2022, generating an additional £2.2mln of income. Total proceeds are 8% above the 31 March 2021 book value, the FTSE 250 group said.
It still has a warehouse let to Primark in a contract with 19 years remaining. On completion of the sale, the portfolio's weighting towards mega distribution will fall from 13% to 10% and its rental income exposure to Primark will fall from 8% to under 5%.
"This is a very good asset that has performed strongly, delivering a total return of 76mln since acquisition,” said chief executive Andrew Jones.
“The sale price achieved reflects a very competitive bidding process and highlights the depth of demand for well let logistics assets delivering reliable, repetitive and growing income."
Shares were up 1% to 261p on Monday morning.