Tritax Big Box REIT plc Pre-let development of Ocado facility (4375D)
29 January 2015 - 6:01PM
UK Regulatory
TIDMBBOX
RNS Number : 4375D
Tritax Big Box REIT plc
28 January 2015
29 January 2015
TRITAX BIG BOX REIT PLC
(the "Company")
FORWARD FUNDEd INVESTMENT IN
A new BIG BOX LOGISTICS FACILITY DEVELOPMENT WITHIN THE M25
FOR OCADO
The Board of Tritax Big Box REIT plc (ticker: BBOX) is pleased
to announce that it has exchanged contracts (conditional on
detailed planning consent) to provide forward funding for a new
distribution warehouse facility located inside the M25 at Crossdox,
Bronze Age Way, Erith, pre-let in its entirety to a subsidiary of
Ocado Group Plc ("Ocado"). The investment price is GBP98.8 million,
reflecting a yield of 5.25% (net of standard acquisition
costs).
The site is located in a core south east location inside the M25
(J 1A) on the south side of the River Thames and A2016, with
Central London approximately 12 miles to the West and Tilbury Docks
and DP World container port to the East. It will also benefit from
excellent access to the wider motorway network including Greater
London and the Home Counties.
Ocado has signed an agreement to lease, conditional upon
detailed planning, for a new 30 year lease, without break, subject
to five yearly rent reviews indexed to RPI (capped and collared).
During the construction phase, the Company will receive an income
return from the developer.
The 35 acre site will be the location of an important South East
logistics hub for Ocado to help fulfil its growing capacity needs
in London and the South East. The investment will comprise a new
distribution warehouse, with a gross internal area of approximately
560,000 sq ft, reflecting a site cover of c. 45%. The development
is being undertaken by Bericote Properties.
Completion of the investment purchase is expected to take place
in the spring of 2015 when construction of the main works will
commence, with practical completion of the developer's base build
targeted for the summer of 2016. The purchase will be funded by the
Company out of equity with senior debt finance expected to be
introduced in the near term.
Ocado has an option to introduce a third party joint guarantor
to the lease on the later of 30 April 2015 and the date of grant of
detailed planning consent, which, if exercised, would result in a
reduction in the lease length from 30 to 25 years, a lower rent
receivable and an increase to the investment price to GBP99.9
million.
Colin Godfrey, Partner of Tritax, commented:
"We are excited to be investing in a new distribution warehouse
facility for Ocado, further diversifying our portfolio tenant mix.
Prime quality Big Box warehouses are in high demand from occupiers
requiring close access to the densely populated London conurbation.
This is one of the very few sites inside the M25 capable of
accommodating a facility of this size."
For further information, please contact:
Tritax Group via Newgate Communications
Colin Godfrey (Partner, Fund Manager)
Newgate Communications (Financial Tel: 020 7680 6550
PR) Email: tritax@newgatecomms.com
James Benjamin
Clotilde Gros
Georgia Lewis
Jefferies International Limited Tel: 020 7029 8000
Gary Gould
Stuart Klein
Alex Collins
Akur Limited Tel: 020 7493 3631
Anthony Richardson
Tom Frost
Siobhan Sergeant
NOTES:
Tritax Big Box REIT plc is a real estate investment trust to
which Part 12 of the UK Corporation Tax Act 2010 applies ("REIT").
The Company invests in a portfolio of well-located, modern "Big
Box" assets, typically targeting buildings greater than 500,000 sq.
ft., let to institutional-grade tenants on long-term leases
(typically between 12 and 25 years in length) with upward-only rent
reviews (providing the potential for inflation linked earnings
growth), and with geographic and tenant diversification throughout
the UK. The Company seeks to exploit the significant opportunity in
this sub-sector of the UK logistics market owing to strong tenant
demand in high growth areas of the economy and limited stock
supply. The Company is the first listed vehicle to give pure
exposure to the "Big Box" asset class in the UK.
Further information on Tritax Big Box REIT is available at
www.tritaxbigbox.co.uk
This information is provided by RNS
The company news service from the London Stock Exchange
END
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