LXi REIT makes acquisitions totalling GBP61m
LXi REIT has acquired 11 foodstores and two discount stores from five different vendors/developers for a total cost of GBP61 million.
The acquisitions have been made at an attractive average net initial yield of 5.7 per cent (net of acquisition costs) and with a strong and diversified tenant base in the form of Aldi, Lidl, Waitrose, Co-op, Iceland, B&M and The Range.
The acquisitions deploy the disposal proceeds of the Group’s recently sold BCA facility in Corby (the BCA Facility) at a yield which is materially higher than both the 4.45 per cent exit yield on the BCA Facility and the Group’s latest portfolio valuation yield of 5.1 per cent.
The acquisitions reflect the Company’s yield-disciplined focus on smaller sized foodstores which are currently the primary focus for our grocery tenants being right-sized for their preferred product range, but also offering online fulfilment through either or both of home delivery and click & collect.
The acquisitions are let or pre-let on long, index-linked or fixed uplift leases with low current rents (averaging GBP14 per sq ft) and low capital value pricing (averaging GBP230 per sq ft).
The Group’s whole portfolio now has a long WAULT to first break of 22 years, with 96 per cent index-linked or fixed uplift rent reviews and is well diversified across the following robust sub-sectors: Industrial (21 per cent), Budget Hotels (21 per cent), Foodstores and Essentials (20 per cent), Healthcare (13 per cent), Car Parks (8 per cent), Pubs (5 per cent), Drive-thru Coffee (4 per cent) and Other (8 per cent).