Purchase of property in Salford

RNS Number : 1402A

Custodian REIT PLC

18 December 2014

 

18 December 2014

Custodian REIT plc

("Custodian REIT" or the "Company")

Purchase of Property

Custodian REIT (LSE: CREI), the UK property investment company, is pleased to announce a further property purchase, bringing the total funds invested following its initial placing and admission to the Official List on 26 March 2014 to £76.7 million. 

The Company has acquired a 69,842 sq ft modern industrial warehouse on Agecroft Commerce Park, Salford, located three miles north west of Manchester city centre and two miles from Junction 15 of the M60.

The property is let to Restore 2 Limited (trading as Cintas Document Management), a leading provider of integrated document management solutions including archiving, scanning and digitisation, and business process outsourcing.  The lease expires on 30 September 2028, at a passing rent of £403,676 per annum, reflecting a net initial yield of 7.9%.

The agreed purchase price of £4.825 million was funded from the Company's existing facilities, with £7.5 million deployed from the Company's revolving credit facility.  Total net borrowings have increased to 10.0% loan to value, in line with the stated investment strategy of a target gearing ratio of 25% loan to value.

Commenting on the acquisition, Richard Shepherd-Cross, Managing Director of Custodian Capital Limited (the Company's external fund manager), said:

"This modern industrial unit offers a high-specification warehouse to its tenant and in return will generate stable, long-term income for Custodian REIT, supporting the target return." 

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For further information, please contact:

Custodian Capital Limited
Richard Shepherd-Cross / Nathan Imlach / Ian Mattioli	Tel: [phone]
	www.custodiancapital.com

Numis Securities Limited
Nathan Brown / Hugh Jonathan	Tel: [phone]
	www.numiscorp.com

Camarco
Ed Gascoigne-Pees	Tel: [phone]
	www.camarco.co.uk

Notes to Editors

Custodian REIT plc is a UK real estate investment trust ("REIT") listed on the London Stock Exchange.  The Company launched on 26 March 2014, acquiring a portfolio of £95 million of UK commercial property.  This was sourced from an existing portfolio of 48 properties held by clients of Mattioli Woods plc in a syndicated structure.  The diverse portfolio consisted of properties let to institutional grade tenants on long leases throughout the UK. 

The Company raised gross proceeds of £55 million through an initial public offering and raised a further £25 million via a subsequent placing.  It invests in a diversified portfolio of UK commercial properties to achieve its investment objective of providing shareholders with an attractive level of income together with the potential for capital growth through a closed-ended fund. 

The target portfolio is characterised by small lot sizes with individual property values of less than £7.5 million at acquisition. 

Custodian Capital Limited is the discretionary investment manager of the Company.

For more information visit www.custodianreit.com and www.custodiancapital.com. 

 

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