Custodian REIT PLC (LSE:CREI) said it acquired a 47,882 sq ft industrial facility near Chesterfield, Derbyshire for £3.5mln.
The facility, located two miles from junction 29 of the M1, is fully let to Container Components Ltd with 20 years remaining on the lease.
The property produces an index linked passing rent of £227,440 per year, reflecting a net initial yield of 6.10%, said the UK property investment company.
“This well located, modern industrial asset has been acquired at an entry yield of 6.10% which is significantly above the market average for industrial assets,” said Richard Shepherd-Cross, managing director of the company’s manager, Custodian Capital Ltd.
“The property also benefits from five-yearly index linked rental increases which provide long-term inflation-adjusted income.”
The acquisition was funded from existing debt facilities, increasing net gearing to 23.8% loan to value, which remains within the company’s target range.
The acquisition increases the industrial weighting of the company’s portfolio of 165 properties to 38%.
“The acquisition demonstrates our continued ability to source high quality assets on behalf of our shareholders which offer enhanced but secure income returns by focussing on smaller sized properties where there is reduced competition,” Shepherd-Cross concluded.