Custodian Property Income REIT has expanded its portfolio through the £22 million acquisition of Merlin Properties, a family-owned investment firm. The deal, completed entirely in shares, adds 28 regional assets valued at £19.4 million and approximately £2.7 million in residential stock.
The assets are primarily located in the East Midlands and comprise a mix of office, high-street retail, and retail park properties. The commercial portfolio, with an average asset value of £700,000, generates annual rental income of around £1.7 million. The residential units (newly built and not income-producing) are expected to be sold in the near term.
To complete the acquisition, Custodian issued 22.9 million new shares to Merlin shareholders, with a further 1.7 million shares to be issued once the final accounts are agreed. These shares will represent roughly 5.6% of Custodian’s enlarged share capital.
This transaction reflects Custodian’s strategy to scale via portfolio or corporate acquisitions, offering liquidity and tax efficiency to private property owners while consolidating regional assets under a listed structure. The move may serve as a model for future deals with family-owned property firms facing generational transitions or capital gains considerations.
