UK property Fund Stenprop has acquired two new industrial estates in Southampton and Preston in separate transactions for a total of £7.45 million.
Stenprop acquired Trinity Court at Brunel Road, Totton in Southampton from Catalyst Capital for £3.9 million which reflects a net yield of 6.6%. Trinity Court is located within Calmore Industrial Estate and it comprised of twelve units, totalling 36, 790 square feet. Its fully let and it produces a total annual passing rent of £273,796 which equates to an average rent of £7.44 per square foot.
“Both estates were acquired at well below replacement cost. Trinity Court is located in a region with very strong demand-supply dynamics, where we currently have no exposure. It attracts a wide range of occupiers and provides an opportunity for future rental growth along with a number of active asset management opportunities … Carnfield Place is a modern estate in a strong strategic location close to the motorway. The passing rents are low, given the high quality of the units, and the estate benefits from large yards and longstanding tenants” commented Julian Carey, Executive Property Director of Stenprop.
Stenprop has taken the strategic decision that its objective to deliver sustainable, growing income to shareholders is best achieved by becoming a specialised UK multi-let industrial property company. This strategic repositioning means that Stenprop intends, over the next few years, to sell all, or substantially all, of its non-multi-let industrial assets and utilise the sale proceeds to build a focused UK multi-let industrial business.
Following the acquisitions of Trinity Court and Carnfield Place, multi-let industriall assets account for 26% of Stenprop’s portfolio. Multi-let industrial assets are expected to comprise approximately 60% to 65% of Stenprop’s total portfolio of properties by 31 March 2020.