Custodian REIT, the property investment company, has acquired two retail warehouses in Measham, Leicestershire, and Droitwich, Worcestershire, occupying an aggregate 40,077 sq ft.
The units are both let to DFS Furniture.
The agreed purchase price of £8.9 million was funded from the company’s existing debt resources.
Richard Shepherd-Cross, Managing Director of Custodian Capital Limited (the company’s discretionary investment manager), said: “These high yielding assets let on long-term leases to a strong covenant are a great addition to our portfolio.
“Retail warehouses continue to demonstrate their relevance and appeal alongside the continued rise of e-commerce, with one out of three sofas sold in the UK purchased in-store, while the ‘halo’ effect of a physical store supporting local online purchases is particularly strong for furniture.
“The attractive entry yield will be accretive to dividend capacity over the medium term. As bricks and mortar retail undergoes a renaissance, and retail parks continue to outperform, we anticipate future market rental growth which should mitigate some of the acknowledged over-rent, support valuations and protect long term income streams.”
