Warehouse REIT bags £11.6m for Warrington shed

A unit let to Iron Mountain is the prize asset in a pair of properties offloaded by the industrial investor in separate deals, at an average net initial yield of 5.3%.

Warehouse REIT said the combined price of £13.4m is 3.7% ahead of the September 2023 book value for the assets, the other of which is in West Yorkshire.

Both buyers’ details were undisclosed.

The sales comprise:

• Warrington South Industrial Estate, a 106,000 sq ft single-let asset acquired in 2019, where Warehouse REIT delivered a 10-year lease renewal in 2020; sold for a total consideration £11.6m; and
• Pellon Lane, a 20,000 sq ft multi-let asset in Halifax acquired in 2017, where the investor successfully secured new lettings or renewals on nearly all the available space since acquisition; sold for £1.8 million.

These transactions bring total sales since 1 April 2023 to £53m for Warehouse REIT, which it described as demonstrating good progress against its commitment to continued capital recycling.

Proceeds from the sales will be used to pay down debt, supporting future earnings.

Simon Hope, co-managing director of Warehouse REIT, said: “Strengthening our balance sheet and earnings position by releasing capital from assets which are low yielding or where we have successfully executed our business plan is a key priority for us.

“As these disposals show, we continue to evaluate all opportunities to do that.

“While the investment market remains subdued, we have sold into pockets of demand, above book value, enabling us to crystallise value for shareholders and increase the portfolio weighting to multi-let assets where we see the most attractive opportunities.”

G10 Capital is the investment manager for Warehouse REIT, while Tilstone Partners provides day-to-day management advisory services.