Pacific Industrial buys nine logistics assets – Pacific Industrial & Logistics REIT has completed the off-market acquisition of a portfolio of 9 logistics assets for a total consideration of GBP45.5m. The purchase price represents a net initial yield of 7.3%.
The deal has been financed from the proceeds of the recent placing, completion of which was announced on 16 August 2017. The remaining proceeds of the placing will be used, together with debt finance where appropriate, to fund acquisitions from the existing pipeline of potential transaction opportunities.
The deal is in line with the investment policy and the portfolio of single-let assets are well located across the UK. The portfolio’s logistics occupiers include Culina, XPO, Sainsbury’s and Travis Perkins. The assets are close to established regional transport hubs in urban or last-mile locations where there is strong occupier demand. The acquisition price reflects an average capital value of GBP61 per sq. ft which is well below replacement cost. The portfolio has an attractive 7.3% running yield, low average rents of GBP4.80 per sq. ft. and a weighted average unexpired lease term of 2.5 years which presents opportunities to grow both the income and asset value.
Richard Moffitt commented: “We are delighted to complete the acquisition of this portfolio of well-located last-mile and urban logistics sites, thereby deploying a substantial proportion of the capital raised through the Company’s recent placing. The portfolio offers a range of asset management opportunities in the short to medium term which we have already begun to progress. As we look to deploy the remainder of the proceeds from the placing and build a bigger business, we have a number of transactions in solicitors hands and in the due diligence process. We will update shareholders with further news in due course ”
PILR : Pacific Industrial buys nine logistics assets