UBS Asset Management makes prime Edinburgh investment

UBS Asset Management's (UBS-AM) Real Estate & Private Markets (REPM) business has, by way of a forward commitment through its Triton Property Fund (Triton), acquired Seven Hills Business Park, in Edinburgh, Scotland, for an expected total consideration of circa GBP15 million. 

The property was partially funded through the timely recycling of proceeds following the sale of Triton's industrial facility in Bristol, which was sold for GBP 9.6 million.
 
Seven Hills is prominently situated within Sighthill Industrial Estate, regarded as Edinburgh’s principal and best industrial location, with excellent transport links. There is an existing 46,835 sq ft asset on the site which comprises three high-specification units, all of which are let or under offer to strong covenants, providing a weighted average unexpired lease term (WAULT) of nine years. An adjacent new 76,000 sq ft development – which is due to complete in autumn 2019 – will offer 11 additional units from 3,360 to 14,700 sq ft and provide the local market with a much-needed new supply of modern industrial/trade counter space.
 
The acquisition of Seven Hills follows the Fund's disposal of the Nova Centre, a 1960's 167,178 sq ft multi-let industrial facility in Avonmouth, Bristol, which had reached the conclusion of its business plan following active asset management.
 
This acquisition is directly in line with the Fund’s strategy to enhance its income distribution and increase its exposure to industrial assets, with a particular focus on urban logistics in major cities. Seven Hills represents the 13th industrial property in Triton’s portfolio, which now accounts for approximately 42 per cent of the portfolio. The balanced fund also comprises offices, retail warehouses and student accommodation.
 
Jonathan Hollick, Portfolio Manager of Triton, says: “The prompt reinvestment of proceeds from the disposal of a non-core asset enabled us to gain access to this prime industrial property in a strong location, while at the same time increasing the quality of our overall portfolio. Edinburgh’s industrial market remains characterised by a lack of supply, making the development aspect of this investment particularly attractive, and leaving us confident in the asset’s ability to generate strong returns for the Fund.”
 
Seven Hills was previously owned by Peveril Securities in a joint venture with Citivale, who were advised on the sale by Knight Frank. UBS-AM were advised by JLL.

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