Acquisition

RNS Number : 2881L

LondonMetric Property PLC

03 July 2014

 



3 July 2014

LONDONMETRIC PROPERTY PLC

MIPP ACQUIRES RETAIL PARK FOR £12.8 MILLION AND
COMPLETES EXTENSION AND EQUALISATION AGREEMENT WITH USS

LondonMetric Property Plc ("LondonMetric" or "the Company") announces that the Metric Income Plus Limited Partnership ("MIPP"), its joint venture ("the Joint Venture") with Universities Superannuation Scheme Ltd. ("USS") has exchanged contracts to acquire Trostre South Retail Park in Llanelli from Benesco, a charity, for £12.8 million, reflecting a net initial yield of 6.8%.

The 75,400 sq ft retail park is let to B&Q, Pets at Home and KFC with a vacant unit of 10,000 sq ft, formerly Dreams, which is subject to a two-year rental guarantee. The average rent is £12.10 psf and unexpired lease term is 14.7 years. The park is adjacent to the 450,000 sq ft Trostre Shopping Park anchored by Tesco, M&S, Next, Debenhams and BHS.

LondonMetric previously announced its agreement with USS to extend the Joint Venture by two years and grow the Company's ownership to 50.0% from 33.3% through further investment.

The above acquisition will be funded entirely by LondonMetric from existing resources and upon completion of the transaction LondonMetric's ownership in MIPP will rise to 42%.

The MIPP portfolio will comprise 19 properties, including Llanelli, with an investment value of £173.4 million and a running yield of 6.3%. The average unexpired lease term across the Joint Venture portfolio is 14.4 years with 25% of the rental income benefiting from fixed uplifts. The average passing rent is £14.20 psf.

Andrew Jones, Chief Executive of LondonMetric, commented:

"This acquisition is consistent with MIPP's investment criteria and demonstrates that, despite a competitive transaction environment, the Joint Venture can continue to source attractive deals that will deliver strong income returns and asset management upside.

"Having reached the Joint Venture's original investment target in December today's transaction enables LondonMetric to make progress towards achieving a 50% ownership position. On completion of Llanelli, we will increase our share of MIPP net income by a further £1.0 million per annum."

Edgerley Simpson Howe advised MIPP. Harvey Spack Field/Metrus advised Benesco.

-Ends-

For further information, please contact:

LondonMetric Property Plc

Andrew Jones / Martin McGann

Tel: [phone]

FTI Consulting

Dido Laurimore/Nina Legge

Tel: [phone]          

USS     

Kathleen MacMillan at Redwood Consulting

Tel: [phone]

About LondonMetric Property Plc

LondonMetric (ticker: LMP) a UK REIT, aims to deliver attractive returns for shareholders through a strategy of increasing income and improving capital values. It invests across the UK primarily in out of town retail and distribution properties. It employs an occupier-led approach to property investments through opportunistic acquisitions, joint ventures, active asset management and short cycle developments. The asset focus is on properties with enduring occupier appeal providing opportunities to improve both rental values and the security and longevity of income; and limited risk redevelopments with the aim of enhancing shareholder returns.  

Further information on LondonMetric is available at www.londonmetric.com.

About Universities Superannuation Scheme

Universities Superannuation Scheme was established in 1975 as the principal defined benefit pension scheme for universities and other higher education institutions in the UK.  It has over 330,000 scheme members across nearly 400 institutions and is the largest private sector pension scheme in the UK, with total fund assets of approximately £42 billion and property assets totalling approximately £2.6 billion.

The scheme's trustee is Universities Superannuation Scheme Ltd, a corporate trustee which provides scheme management and trusteeship from its offices based in Liverpool and London.  The trustee company delegates implementation of its investment strategy to a wholly-owned investment management subsidiary company - USS Investment Management Limited - which provides in-house investment management and advisory services.

For more information on Universities Superannuation Scheme please go to www.uss.co.uk

 

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