Listed property fund Tritax Big Box REIT has exchanged and completed contracts with Santander to buy a site in Wigan for the development of a new distribution and production facility which will be pre-let to wet wipe manufacturer Nice-Pak International.
The developer of the scheme is Liberty Properties, represented by the industrial team at Savills with funding advice provided by JLL and Savills.
An existing Santander call centre will be demolished to make way for the new development.
The investment price was £28.66m, reflecting a yield of 6.42% net of land acquisition costs.
Once the property is completed 150 staff will relocate from Nice-Pak's current base in Hindley Green.
The development is partly funded by the Government's Regional Growth Fund, which Liberty secured with the support of Wigan Council.
The site is located in Westwood Park, south of Wigan town centre near the M6.
The building will cover 399,500 sq ft, with cross docking and an eaves height of 11 metres.
The new facility will become Nice-Pak's primary headquarters serving its UK, European, Australian and New Zealand operations. Nice-Pak intends to commit significant capital into the property through machinery and automation in order to enhance production and distribution efficiency.
Contracts have been exchanged and completed to acquire the land and provide funding to develop the facility. Upon practical completion, the facility will be leased to Nice-Pak on a new 25-year lease, without break, subject to five yearly upward only rent reviews indexed to the Retail Price Index, providing a minimum of 2% a year rental growth capped at 4%. During the construction phase, Tritax will receive an income return equivalent to the rent from the developer.
Construction of the main works is expected to commence immediately with practical completion of the construction targeted for the spring of 2016. The land purchase will be funded by the company from equity proceeds, with senior debt finance expected to be introduced in the near term.
CBGA represented Tritax.