SEGRO AND HERMES COMPLETE INDUSTRIAL ASSET SWAP

RNS Number : 0125J

SEGRO PLC

15 December 2015

 

                                                                                                            15 December 2015

SEGRO AND HERMES COMPLETE INDUSTRIAL ASSET SWAP

·           SEGRO acquires fully-let distribution warehouse in West London

·           Hermes takes ownership of two multi-let industrial estates

SEGRO plc ('SEGRO' or the 'Group') and Hermes Property Unit Trust ('Hermes' or 'HPUT') have completed a property swap transaction. SEGRO has acquired from Hermes a 9,800 sq m single-let, modern distribution warehouse in Hayes, West London for £21.9 million. Hermes has purchased from SEGRO two multi-let industrial estates totalling 29,300 sq m, both situated close to Heathrow Airport for £47.0 million. The balance of £25.1 million has been paid by Hermes to SEGRO.

The property acquired by SEGRO is located in Hayes, West London, approximately one mile from Junction 3 of the M4 motorway. It is let to Allport Cargo Services until 2026 with a rent review in March 2016. The building was constructed in 2001 and benefits from high specification and low site cover which will allow for future development or extension opportunities. The net initial yield on acquisition is 4.9 per cent and the rental income of the asset is considered reversionary.

The properties acquired by Hermes are Polar Park and the Fairway Trading Estate, both close to Heathrow Airport.  The nine units are fully-let and the combined topped up net initial yield is 5.5 per cent, representing a small premium to the book value at 30 June 2015.

Phil Redding, SEGRO's Chief Investment Officer, commented:

"This off-market transaction represents SEGRO's second property swap in three months and has allowed us to acquire a modern, well-specified distribution warehouse let to a strong single occupier on a long lease in an area of West London critically short of modern space."

Chris Mathew, Fund Director at Hermes Investment Management, the £29.5 billion manager focused on delivering superior, sustainable, risk adjusted returns to its clients responsibly, commented:

"These purchases represent a net investment by HPUT, enhancing the portfolio's industrial exposure with well-located and well configured units situated in one of the UK's most competitive industrial markets."

ENDS

For further information, please contact:

SEGRO plc

Harry Stokes (Head of Investor Relations and Research)

Tel: [phone] / [e-mail]

Lizzie Humphreys (External Communications Manager)

Tel: [phone] / [e-mail]

Richard Sunderland / Claire Turvey (FTI Consulting)

Tel: [phone]

Hermes Investment Management

Clare Hartshorne                        [e-mail] 

Isabel Stoddart                          [e-mail] 

Redwood Consulting                   [phone] / [phone]         

Notes to Editors:

SEGRO plc

SEGRO is a UK Real Estate Investment Trust (REIT), and a leading owner, asset manager and developer of modern warehousing and light industrial property. It owns or manages 5.7 million square metres of space in £6.4 billion of assets (at 30 June 2015, SEGRO's share of which totals £5.2 billion), serving 1,200 customers from a wide range of industry sectors. Its properties are located around major conurbations and at key transportation hubs across nine European countries, principally in the UK, France, Germany and Poland.

For further information see www.SEGRO.com/investors.

Hermes Investment Management

Hermes is focused on delivering superior, sustainable, risk adjusted returns for our clients - responsibly.

Hermes manages assets on behalf of more than 300 clients* across equities, fixed income, alternatives and real estate, with £29.5 billion* assets under management. In Hermes EOS, we have the industry's leading engagement resource, advising on more than £146.6 billion* of assets.

We believe in Excellence, Responsibility and Innovation

·      Excellence: We aspire to excellence in everything we do. This manifests itself most visibly in our investment performance. We will only offer products to our clients where we believe there is a strong investment thesis and where we can deliver sustainable alpha.

·      Responsibility: We believe it is our responsibility to lead discussion and debate about the fiduciary responsibilities of fund managers to our clients, their stakeholders and, ultimately, society at large.  We have always sought positive engagement with the firms in which we invest.

·      Innovation: We have the entrepreneurial culture to identify forward-looking products that meet those needs, along with the resources and speed-to-market mentality to develop them rapidly.

Our structure gives clients globally the benefit of access to a broad range of specialist, high conviction investment teams operating within an established and robust operating platform.

Hermes' investment solutions include:

·      Private markets - International real estate, pooled funds, segregated mandates, UK commercial real estate, UK commercial real estate debt, UK private rental sector real estate, infrastructure and
private equity

·      High active share equities - Asia, global emerging markets, Europe, global, and small and mid cap

·      Specialist fixed income - Absolute return credit, global high yield bonds, multi strategy credit, UK government bonds, and UK and global inflation-linked bonds

·      Multi asset - Multi asset inflation

·      Responsible investment services - Corporate engagement, intelligent voting and public policy engagement

Follow us on Twitter: @Hermesinvest

Website: www.hermes-investment.com 

* Please note the total AuM figure includes £4.0bn/€5.4bn/US$6.1bn/A$8.6bn of assets managed or under an advisory agreement by Hermes GPE LLP ("HGPE"), a joint venture between Hermes Fund Managers Limited ("HFM") and GPE Partner Limited. HGPE is an independent entity and not part of the Hermes group. £0.2bn/€0.3bn/US$0.3bn/A$0.4bn of total group AuM figure represents HFM mandates under advice.

Source: Hermes as at 30 September 2015 with exception of two portfolios totalling £0.5bn/€0.7bn/US$0.8bn/ A$1.1bn dated as at 31 August 2015.

 

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