Warehouse REIT acquires Glasgow Airport multi-let industrial property for GBP5.3m
Warehouse REIT has acquired a modern multi-let warehouse estate on Glasgow Airport Business Park, Glasgow, totalling 55,600 sq ft. The purchase price of GBP5.3 million reflects a net initial yield of 6.3 per cent.
The three units, which range from 16,500 sq ft to 21,600 sq ft, are occupied by two global transport, logistics and delivery companies and a craft beer distributor. The property generates a net rental income of GBP357,000 per annum, equating to a low average passing rent of GBP6.40 per sq ft and provides a WAULT of over four years to expiry.
Glasgow Airport Business Park is a prominent business location adjacent to Glasgow Airport, approximately nine miles west of the city centre. Occupiers benefit from strong local and global transport links, including plane, train, bus and car networks. The business park is located within one minute’s drive of the M8 motorway, Scotland’s busiest arterial route, and will further benefit from the development of the proposed Glasgow Airport Tram Link.
Glasgow is Scotland’s largest city and its surrounding region is home to 2.3 million people, totalling more than 40 per cent of Scotland’s population and making it the fifth largest urban area in the UK. Benefiting from strong industrial occupational demand throughout the Covid-19 pandemic, Scotland’s industrial market saw take-up in the first three quarters of last year reach over 4 million sq ft, a 2.5 per cent increase on the same period the previous year.
On 5 February 2021, Warehouse REIT announced it had successfully raised GBP45.9 million by way of a placing to fund a near term pipeline of acquisitions. Today’s announcement follows the previously announced GBP14 million acquisition of two distribution warehouses in Harlow and a GBP35 million warehouse estate in Liverpool and marks the successful deployment of GBP57.4 million (including costs), to give a blended NIY of 6.3 per cent.
Andrew Bird, Managing Director of the Investment Advisor, Tilstone Partners Limited, says: “Glasgow is one of the UK’s most dynamic cities, with a growing workforce. Given ongoing e-commerce demands and a vibrant occupational market, it is forecast to see strong levels of warehouse investment activity and rental growth. The business park occupies a highly sought-after position and furthers the Company’s exposure in what is a key market, whilst adding three strong covenants to the tenant roster.
“Whilst the Company has now completed on its near-term pipeline identified as part of the recent successful placing, thereby deploying all of the equity raised, it continues to source attractive opportunities in line with its ambition to continue scaling and diversifying the portfolio, utilising the agreed Revolving Credit Facility.”