Picton sells Drury Lane warehouse for £2.2m
The property investment company, has sold a 16,418 sq ft warehouse in Drury Lane, Oldham to Nottingham City Council for £2.2m.
The warehouse was originally purchased by Picton in April 2010 for £400,000 as part of the acquisition of Rugby Reit, the Rugby Estates Investment Trust. The property came with an annual rent of £74,000.
Picton secured planning consent to change the use from industrial to leisure, completed a full refurbishment, acquired land for car parking and subsequently let the unit to The Gym Group until 2031 at an annual rent of £150,000.
The sale price reflects a net initial yield of 6.4%. Including the £800,000 spent by Picton on costs, the asset was sold at an 80% profit.
Michael Morris, chief executive of Picton, said: “This is a good example of how we used our knowledge of the local market and asset management expertise to double the income and capture a significant increase in value. The proceeds can be used, together with existing funds, to opportunistically acquire assets in larger lot sizes that we believe will generate attractive future returns.”
Davies Harrison acted as agent for the vendor, Lambert Smith Hampton represented Nottingham City Council.