Legal & General Property (LGP), on behalf of its Linked Pensions Fund, has purchased a recently developed Travelodge hotel and three retail units located in the centre of High Wycombe from McLaren Property.
The purchase price of GBP11,005,000 reflects a net initial yield of 6.8 per cent.
Occupying a prominent site in High Wycombe’s central retail area, the property is located immediately adjacent to one of the busiest entrances of the town’s main shopping centre, the Eden Centre, on White Hart Street. Comprising a part new build, part refurbished, mixed-use development, the asset is arranged with three retail units on the ground floor and a 120 bedroom Travelodge hotel occupying a ground floor lobby and the five storeys above.
The hotel is let to Travelodge on a FRI lease for a term of 25 years, expiring in November 2036, with Travelodge Hotels Limited accountable for 73 per cent of the total passing rent on the property. One of the retail units is vacant, while the other two are let to Sports Direct and Sassy & Co Hair & Beauty, until September 2022 and May 2022, respectively.
Will Edwards, fund manager of the Linked Pensions Fund at Legal & General Property, says: “This transaction is in line with fund strategy as it offers increased exposure to index-linked rental growth in an alternative asset class. The property provides the Linked Pensions Fund with an excellent opportunity to acquire a hotel on a long secure lease at a sensible yield. Furthermore, it is well located in High Wycombe where there is an interesting supply/demand dynamic.”
Montagu Evans acted for McLaren and LGP was advised by Strutt & Parker.