Forward Funded Investment in a New Pre-Let Logistics Facility at Midlands Logistics Park, Corby for £89.3 millionRead more
29 June 2018
The Board of Tritax Big Box REIT plc (ticker: BBOX) is pleased to announce that the Company has exchanged contracts for the forward funded development of a new logistics fulfilment centre at Link 66, Darlington, pre-let to a financially robust world leading retailer. Completion is expected in early July 2018 when the land will be acquired and the development will commence. The price represents a maximum commitment of c.£120.7 million, reflecting a net initial yield of 5.0% (net of acquisition costs to the Company).
The development will comprise a cross-docked facility with 360-degree circulation, an eaves height of 18 metres and low site cover of approximately 32%. The new prime facility will be constructed to a high specification with a gross internal floor area of c.1,508,367 sq ft. The ground floor will extend to c.542,060 sq ft surmounted by two structural mezzanine floors. The property will benefit from significant capital investment by the occupier, including high levels of automation.
The site forms part of Link 66, an emerging logistics location situated on the eastern edge of Darlington at the junction of the A66 and A1150, with excellent motorway connectivity via junctions 57 and 58 of the A1(M). The planned Darlington northern bypass will link the A1(M) at junction 59 to the A66 roundabout adjacent to the subject site. The location also benefits from close proximity to the cargo ports at Tees and Hartlepool, access by air via Durham Tees Valley Airport and by rail from Darlington railway station.
Upon practical completion of the construction, targeted for summer 2019, the property will be leased on a new 20-year lease, subject to five yearly upward only rent reviews indexed to the Consumer Prices Index (collared at 1% pa and capped at 3% pa). The first rent review is due in summer 2024. From completion of the land purchase and during the construction phase, the Company will receive an income return equivalent to the agreed rent from the developer, thereby providing 21 years of projected income.
The development is being undertaken by db symmetry, a highly experienced developer of UK industrial logistics property.
DTRE represented the Company and CBRE represented the vendor
Colin Godfrey, Partner of Tritax, commented:
“We worked very closely with both the occupier and db symmetry in the delivery of this off-market pre-let development. Once operational the facility will be one of the most technologically advanced buildings of its kind in the UK. The investment diversifies the Company’s portfolio by geography and provides further exposure to a high calibre tenant on a long lease.”
For further information, please contact:
via Newgate below
Newgate (PR Adviser)
Tel: 020 7680 6550
The Company’s LEI is: 213800L6X88MIYPVR714
Tritax Big Box REIT plc is the only listed vehicle dedicated to investing in very large logistics warehouse assets (“Big Boxes”) in the UK and is committed to delivering attractive and sustainable returns for shareholders. Investing in and actively managing existing built investments, land suitable for Big Box development and pre-let forward funded developments, the Company focuses on well-located, modern “Big Box” logistics assets, typically greater than 500,000 sq. ft. (measured by floor area, c. 65% of the Company’s existing logistics facilities including forward funded developments are in excess of 500,000 sq ft.), let to institutional-grade tenants on long-term leases (typically at least 12 years in length) with upward-only rent reviews and 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 and limited supply of Big Boxes.
The Company is a real estate investment trust to which Part 12 of the UK Corporation Tax Act 2010 applies (“REIT”), is listed on the premium segment of the Official List of the UK Financial Conduct Authority and is a constituent of the FTSE 250, FTSE EPRA/NAREIT and MSCI indices.
Further information on Tritax Big Box REIT is available at www.tritaxbigbox.co.uk