Custodian REIT PLC (LSE:CREI) said it has sold an industrial warehouse in Scotland for £1.4mln, 12% more than its valuation at the end of June.
The 18,424 sq ft unit in Kilmarnock was sold at auction, the property investment group said, as its environmental credentials “no longer fit” with the company’s environmental, social and governance (ESG) objectives and it was not considered practical to mitigate these risks.
Last month, the company appointed a new ESG advisor to help improve the energy performance of its buildings, reduce energy usage and emissions, and better understand environmental risks and opportunities.
Having bought the Kilmarnock property as part of its initial public offer in 2014 and after recently increasing the lease term by a decade, managers Custodian Capital felt it was the right time to sell and crystallise a valuation uplift.
“The sale of this industrial unit at a premium to valuation demonstrates the ongoing liquidity in the market for smaller lot sized commercial real estate, underscoring our investment thesis,” said Richard Shepherd-Cross, managing director of Custodian Capital.
He added: “The proceeds of the disposal will be recycled into identified improvements to the remaining portfolio which we believe will be more accretive and better support the strategy of providing shareholders with strong income returns.”