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LondonMetric Property Plc (LSE:LMP) has made significant strides in its investment strategy, announcing a series of transactions that include a £70 million acquisition of warehouse properties and £50 million in disposals. The move reflects the Company's ongoing commitment to optimizing its real estate portfolio.
Acquisition Highlights
LondonMetric's recent acquisitions total £70 million and encompass a diverse range of warehouse properties. The transactions include seven warehouses with a weighted average unexpired lease term (WAULT) of 15 years. These properties were acquired at a blended net initial yield (NIY) of 5.8%, which is set to rise to a minimum of 6.1% over the next two years, and reach 6.5% after five years. Notably, 91% of the rental income from these assets is subject to open market reviews, ensuring potential for rental growth.
Among the acquisitions, a prominent deal was the purchase of a 182,000 square foot regional logistics warehouse in Avonmouth, let to Farmfoods Ltd. This property was acquired through a sale and leaseback transaction for £26.4 million. The lease includes five-yearly rent reviews tied to either the open market value (OMV) or the consumer price index (CPI) plus 1%, compounded annually.
Additionally, LondonMetric acquired a 211,000 square foot fully let urban logistics park in Wednesbury for £25.0 million. This asset, purchased from a pension fund, features a low site density of 21% and presents immediate asset management opportunities through open market reviews.
The Company also secured five trade warehouses in Leeds, Derby, Swindon, Bolton, and Farnham, totaling 113,000 square feet. These properties, acquired for £18.9 million, are leased to prominent tenants including Travis Perkins, MKM, and Jewson.
Disposal Details
In parallel with these acquisitions, LondonMetric has completed £50 million in disposals. The disposed assets include ten former LXi assets and one former CTPT asset, sold at a blended NIY of 7.2%, aligning with the book values reported as of March 31, 2024.
Among the disposed properties, a 169,000 square foot Compass training centre in Milton Keynes was sold for £23.7 million. A 34,000 square foot car showroom in York, let to Vertu, was sold for £10.5 million. Another 34,000 square foot self-storage asset in Basildon, let to Lok'nStore, was disposed of for £10.0 million.
Additionally, LondonMetric sold seven care homes for £3.2 million and an 18,000 square foot Nissan car showroom in Doncaster for £2.5 million.
