Tritax Big Box REIT has bought the 380,000 sq ft Argos regional distribution centre in Heywood Distribution Park for £34.1m, a net initial yield of 5.3%.
Developed in 1998 for Argos by Canmoor, the owner of Heywood Distribution Park, the facility has cross docking, an eaves height of 15.2 metres and comprises a rentalised area of 381,106 sq ft.
The centre is being acquired with an unexpired lease term of around 13 years, subject to five yearly open market rent reviews. The next review is due in 2018.
The purchase has been funded out of equity proceeds, with senior debt finance expected to be introduced in the near term. Completion is due to take place on 29 April 2015.
The Heywood Distribution Park is located on the A58 trunk road linking Leeds and Manchester.
Buchanan Bond represented Tritax and Rapleys represented the vendor.
Colin Godfrey, partner of Tritax, said: "The property is strategically positioned to service large parts of the North West region, supporting Argos' e-retail and click and collect growth in the region. The North West is a key logistics location and, in 2014, the region saw the highest take up of logistics space with major occupiers such as Travis Perkins, the Hut, Nice Pak, B&M and DHL, helping to support the more attractive rent levels of comparable assets in the surrounding area."