SEGRO has acquired a 210,000 sq ft prime, big box distribution warehouse in Northampton in exchange for two recently developed Premier Inn hotels in Uxbridge and Edmonton.
The big box warehouse is fully let to a global third party logistics provider. The warehouse is located in Grange Park in Northampton which is a core logistics area for UK distribution directly next to junction 15 of the M1 motorway.
The warehouse was constructed in 2000 and the lease to Yusen Logistics has nine years to expiry. The purchase price of £20.5 million equates to a net initial yield of 5.5 per cent.
The hotels, let to Premier Inn, are in roadside locations at the edge of two recently completed SEGRO developments in Uxbridge and Enfield. The Premier Inn in Uxbridge was completed in December 2015 and is close to junction 1 of the M40 motorway, while the Premier Inn in Edmonton is adjacent to London’s inner ring-road (the A406) and was completed in November 2014.
The disposal proceeds for the two assets total £20.5 million, equating to a net initial yield of 4.7 per cent, in line with the valuation at June 2016.
Phil Redding, SEGRO’s Chief Investment Officer, said: “The acquisition of a big box warehouse in exchange for two hotels is in line with SEGRO’s strategy of building scale in its UK big box portfolio while also crystallising gains we have generated from the development of higher-value use assets on industrial land.”