17 December 2015
The Board of Tritax Big Box REIT plc (ticker: BBOX) announces this trading update as it enters the close period for the year ending 31 December 2015. This statement provides an update on investment activity, portfolio performance and market conditions.
1 as at 30 June 2015 valuation plus acquisition price for subsequently acquired properties
2 including forward funded assets
3 Source: Bloomberg, to 16 December 2015 respectively, based on closing share price of 126.3p
The UK has one of the greatest warehouse space requirements in Europe driven by the strong economic outlook and the growth in internet sales which are expected to represent 19% of total retail sales by 2019, up from 13% in 2014 (source: eMarketer). Meanwhile, logistics availability in the UK has been decreasing since 2009 with the supply of speculatively developed Big Box assets extremely limited. As far as the Company’s investment manager is aware, no Big Box assets of 500,000 sq. ft. or above are currently being developed speculatively.
Prime logistics yields have compressed by approximately 75 basis points since the Company’s IPO in December 2013 and currently stand at approximately 5.0% with the potential for further compression in 2016 given the imbalance between supply and demand which is unlikely to be rectified in the short to medium term.
As a result of growing occupier demand and constrained occupational supply, strong rental growth has been evidenced during the last 18 months and is expected to continue through 2016 with the Company well placed to capture market rental growth given the profile of rent reviews across the portfolio.
For further information, please contact:
Newgate Communications (Financial PR)
Tel: 020 7680 6550
Tritax Big Box REIT plc is a real estate investment trust to which Part 12 of the UK Corporation Tax Act 2010 applies (“REIT”). The Company invests in and asset manages a portfolio of well-located, modern “Big Box” assets, typically targeting buildings greater than 500,000 sq. ft., let to institutional-grade tenants on long-term leases (typically between 12 and 25 years in length) with upward-only rent reviews (providing the potential for inflation linked earnings growth), and with geographic and tenant diversification throughout the UK. The Company seeks to exploit the significant opportunity in this sub-sector of the UK logistics market owing to strong tenant demand in high growth areas of the economy and limited stock supply. The Company is the first listed vehicle to give pure exposure to the “Big Box” asset class in the UK.
Further information on Tritax Big Box REIT is available at www.tritaxbigbox.co.uk