Wed, 08/07/2009 - 11:10
The Advantage Property Income Trust, a UK commercial property investment company, has disposed six of its investment properties for a total of GBP10.7m which will be used to repay debt across its two banking facilities.
The disposals were undertaken as part of the normal course of business at an average of 8.5 per cent below the 31 March 2009 valuation and reflect an aggregate net initial yield of 9.0 per cent.
The disposals comprised two industrial properties, three retail warehouses and one retail complex.
The Orbit Centre on Ashworth Road in Bridgemead, Swindon is a long leasehold estate of 20 small warehouses and trade counter units, on approximately 2.04 acres, let to a combination of national and local covenants including City Sprint, HSBC Bank, The Swindon Bed Centre, and the Battery Shop. Over 75 per cent of the leases expire over the next three years. It has been sold to a local investor for a sum of GBP1.7m reflecting a yield of 10.8 per cent.
Granville Street, Dover and Bradfield Road, Huddersfield are two detached 15,000 sq ft retail units let to Halfords on a leases expiring in 2021, and subject to five yearly rent reviews with the next review due in 2011. Both were sold to a group of private investors for a total of GBP4.8m reflecting an initial yield of 8.9 per cent.
Weedon Road, Northampton is a detached 13,000 sq ft retail unit let to Halfords on a lease expiring in June 2016. It has been sold to a private investor for the sum of GBP2m, reflecting a yield of 9.0 per cent.
Market House in Market Square, Aylesbury is a parade of three retail units at ground floor with two floors of ancillary/office accommodation above. The units are let to National Grid Holdings, Dolland & Aitchinson, and Tui UK with leases that expire between 2013 and 2015. It was sold to private investors for the sum of GBP1.9m, reflecting a yield of 9.5 per cent.
Mackintosh Road, Kirkton Campus, Livingston is a vacant industrial unit of 6,237 sq ft occupying a site area of approximately 1.28 acres. It was sold to an adjoining occupier for GBP0.3m.
Through these sales the Tap portfolio has been re-balanced with less exposure to the Halfords covenant within its retail warehousing holdings, reduced exposure to high street retail, and the disposal of a small element of its void industrial.
Chris Carter Keall, fund manager for Tap at Valad Asset Management, the property fund adviser, says: 'These disposals were set out in the business plan at the end of Q1 2009. We are pleased that the levels achieved were in line with expectations and this shows a continuing demand for smaller assets within the private investor market.
'The receipts from these disposals, will be applied to repayment of loans, and will ensure that there is no risk that Tap will be in breach of any of its covenants and will put the company in a stronger financial position going forward.'
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