Custodian REIT PLC (LSE:CREI) announced a £15mln acquisition of a retail park in Nottingham, which is occupied by Wickes, Matalan, Poundland and KFC.
The purchase of the 70,160 sq ft property was funded from existing debt resources, the property investment company said in a statement.
Nearby retailers include Tesco, Morrisons, Lidl and McDonald’s.
The four units have a weighted average unexpired term to first break or expiry of nine years. Rent from the retail park is £994,050 a year, reflecting a net initial yield of 6.21%.
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“Well located retail warehouses let off low rents are complementary to online retailing and have remained in demand during the restructuring of the retail market,” noted Richard Shepherd-Cross, managing director of Custodian Capital Limited (LSE:CAPD), the company’s discretionary investment manager.
“This purchase, which was agreed off-market at an attractive net initial yield, offers long income from a very strong tenant line up with opportunities to enhance rents by developing a drive-through restaurant and installing electric vehicle charging points.”