Disposal

RNS Number : 7681W

Pacific Industrial & Log REIT PLC

17 November 2017

 

Pacific Industrial & Logistics REIT plc

("Pacific Industrial & Logistics" or the "Company")

Disposal

Pacific Industrial & Logistics, (AIM: PILR), the specialist UK industrial and logistics REIT, on 16 November 2017 completed the sale of an asset located at Hammond Road, Bedford, for a total consideration of £5.8 million, (the "Disposal"). The sale price represents a net initial yield of 6.0%. 

The Disposal follows the recent letting of the property on a 10-year lease to P W Gates at a passing rent of £6.29 per sq ft, a leading rate for the estate. The total consideration represents a 64% gain on the asset's cost when purchased at the time of the Company's April 2016 IPO, representing an IRR of approximately 43% and a 19% premium to book value as at 31 March 2017.

The sale of Hammond Road is consistent with the Company's active investment policy. The Company intends to deploy the proceeds of the Disposal back into its pipeline of logistics opportunities.

Commenting on the Disposal, Richard Moffitt, Chief Executive, said:

"We are delighted with the price achieved by this sale, which has delivered a return well above cost and book value.

"Our active portfolio management strategy focuses on sourcing attractively priced assets and actively managing them to achieve their potential. We continue to be acquisitive and will deploy the proceeds from the sale, together with our existing funds, into our pipeline of new opportunities."

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For further information contact: 

Pacific Industrial & Logistics REIT plc Richard Moffitt Christopher Turner Sam Tucker	[phone]
Canaccord Genuity - Nominated Adviser and Joint Financial Adviser Bruce Garrow Charlie Foster	[phone]
Montfort - Financial PR and IR adviser Nick Miles Olly Scott	[phone]

About Pacific Industrial & Logistics REIT

Pacific Industrial & Logistics REIT plc is a property investment company, quoted on the AIM market of the London Stock Exchange, (AIM: PILR).

The Company has been established to invest in UK based industrial and logistics properties with the objective of generating attractive dividends and capital returns for its shareholders. Its investment strategy focuses on strategically located smaller single let industrial and logistics properties servicing high-quality tenants. Investment returns will be generated by an experienced management team focusing on quality stock selection and active asset management.

A number of structural and commercial factors currently support the attractive opportunity in the last mile/regional industrial and logistics real estate sub-sectors targeted by the Company, including: strong occupier demand, (driven by the growth of e-commerce and investment by retailers in their associated supply chain) and a decline in the supply of lettable space in industrial and logistics real estate across the UK (being more than one third lower than the most recent peak of 2009).

Acquisitions are targeted in the 6.5-7.5% net initial yield bracket, (with affordable underlying rents in the region of £4.50-£5.50 per sq ft), on an overall LTV of 35-40% and a significant margin over financing costs, thus presenting attractive income, capital growth and total return opportunities.

At the time of its results for the period from IPO on 13 April 2016 to 31 March 2017, the Company achieved a 22.6% total shareholder return, including aggregate dividends of 6 pence per ordinary share on an IPO price of 100p.

 

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