DHL Skelmersdale Brookfield Copley Point p.via CP

DHL has 18 months left to run on its Skelmersdale lease Credit: via Copley Point

Tritax sells regional assets in £125m deal 

Industrial units totalling 1m sq ft in Knowsley and Skelmersdale have been sold to a partnership between Brookfield Real Estate and Copley Point. 

The £125m deal also included Tritax Big Box REIT’s 330,000 sq ft asset in Worksop, which is let to Cerealto. 

Overall, the acquisition of the three assets reflects a blended net initial yield of 4.6%, lower than the 6.36% blended yield Tritax achieved when it acquired the units. 

In Skelmersdale, Copley Point and Brookfield have acquired a 470,000 sq ft DHL distribution hub. DHL sold the unit to Tritax in 2014 for £28m and agreed a 10-year leaseback at the same time. The courier’s lease expires in 18 months. 

In Knowsley, the JV has taken control of the 578,000 sq ft Matalan warehouse. The retailer has more than 13 years left to run on its lease. 

All three assets are “non-core to the investment strategy of the company and have delivered an attractive blended IRR of 12.8% per annum over the combined hold period”, according to Tritax. 

“We constantly seek ways to optimise our portfolio to crystalise value and redeploy capital into higher returning opportunities,” said Colin Godfrey, chief executive of Tritax Big Box. 

“The disposal of three assets for £125m, in line with their book value, demonstrates the ongoing effective implementation of our strategy and the attractiveness of our assets.”

He added: “The sale to a leading global investor in real estate provides further evidence of the growing stabilisation within the UK investment market. With the UK’s largest logistics-focused land portfolio, we have a significant pipeline of higher returning development opportunities we are able to recycle capital into.”   

Tritax will retain a small minority interest and Copley Point, who are investing alongside Brookfield, will manage the portfolio.

Guillaume Savoie-Coulonval, managing director at Copley Point, said the portfolio comprised “Grade A properties in strong locations with attractive asset management opportunities”.

“We are excited to start working on those opportunities with the Brookfield team,” he added. “We’re also happy to conclude another transaction with Tritax, which allows it to recycle capital in line with its business plan.”

Alexis Prevot, managing director at Brookfield Real Estate Solutions, said: “This recapitalization marks the fourth investment through Brookfield’s real estate solutions strategy in Europe in the last 12 months and we continue to see a range of interesting opportunities.”

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