London – M7 Real Estate, the pan-European investor and asset manager, announces that it has acquired four industrial assets for a consideration of £7.1 million on behalf of M7 REIP III (“REIP III”), a separate account which is focused on smaller UK regional commercial real estate assets. The purchase price reflects a Net Initial Yield of 9.3%.
The acquisition comprises four single-let industrial properties, three of which are in England and the fourth in Scotland, totalling 241,864 sq ft. The assets are located in Newton Aycliffe, c. 20 miles north west of Middlesbrough off the A1; Milton Keynes; Washington, which is strategically located between Sunderland and Newcastle; and Kirkintiloch, just outside Glasgow. All of the assets, which were acquired from Roebuck Asset Management (Newton Aycliffe and Washington), CBRE Global Investors (Milton Keynes) and Mutley Properties (Kirkintiloch), are single let to tenants including Gestamp Tellant, Molins plc, Rayovac Europe Ltd and Howdens Joinery Properties Ltd, on an average unexpired lease term of 10.65 years.
In a separate transaction, M7 has also invested £3.3 million across a mix of retail, leisure and office assets on behalf of MOVVI, another separate account. The properties, totalling 39,503 sq ft, are located in Coventry, Birmingham and Manchester and are fully let to 18 tenants.
John Murnaghan, Head of UK Asset Management for M7 said: “Each of these acquisitions are well located, which will help support capital growth moving forward. This aside, our strategic focus will be on leveraging the income potential through the deployment of asset management initiatives, including lease extensions and value-adding capital investment.
“Together, these transactions reflect our continuing confidence in the capital and rental growth prospects for the UK regional market, supported by the ongoing economic recovery and increasing capital investment outside the south east.”
M7 was advised by Lambert Smith Hampton, Connect Property North East and Kleine & Co.