Purchase of Property

RNS Number : 0830K

Custodian REIT PLC

20 June 2014

 



20 June 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 the completion of a further property purchase following its initial placing and admission to the Official List on 26 March 2014. 

The Company has acquired a warehouse unit on Hamilton International Park, 12 miles south of Glasgow.  The property, constructed in 1998, comprises a 38,164 sq ft warehouse unit on a 2.41 acre site with an 80 space car park and a loading yard.  Other occupiers on the 76 acre business park include Eden Spring, South Lanarkshire Council, HSBC, John Lewis Partnership, Scottish & Universal Newspapers, Scottish Power and ICM Computer Group.

Since the property was constructed and following the expiry of the initial 15 year lease it has experienced only a 4 month period of vacancy before being let to Ichor Systems Limited ("Ichor").  Ichor has agreed a ten year lease expiring on 7 May 2024 without break.  The property is let at a passing rent of £175,000 per annum, reflecting a net initial yield of 9.01%.  The purchase consideration of £1.835 million was funded from the Company's own cash resources. 

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

"This modern warehouse unit has been acquired at close to vacant possession value, but benefits from a new 10 year lease to a fast-growing company.  I believe there is a dearth of speculative warehouse development in the greater Glasgow area, giving this property capacity for both rental and capital growth in the short to medium term." 

-Ends-

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

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 also raised gross proceeds of £55 million through an initial public offering and will invest 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. 

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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