Stenprop snaps up UK industrial estate
The £4.8 million (R89.5 million) acquisition is part of its property portfolio reshaping.
JSE-listed real estate firm, Stenprop, has bought an industrial estate in the UK for £4.8 million (R89.5 million) from a private individual in an off-market deal, the company announced on Wednesday.
Dunball Industrial Estate is located in Bridgwater, Somerset, and has four units, totaling 48,432 square foot of industrial space. Three of the four units are let to manufacturing company Scania, logistics company Wincanton and aerospace company Astigan and the remaining one unit is vacant.
Stenprop said the weighted average lease term is two-and-a-half years, with total annual rent being £245,000 (R4.6 million), which equates to an average rent of £6.74 (R126) per square foot.
Julian Carey, the executive property director of Stenprop, said the acquisition is “an excellent addition” to the company’s portfolio of properties in a region where its exposure is limited.
“Dunball Industrial Estate has a strong letting history, with opportunities for immediate rental growth and a strong tenant line up. The wider Bridgwater area is undergoing a period of change with the development of the nuclear power station at Hinkley Point C, which will create 25,000 jobs and increase industrial demand in the short, medium and long terms,” said Julian in a statement.
The purchase of the industrial estate is part of Stenprop’s plan to become a specialised UK multi-let industrial property firm. A multi-let industrial asset is an industrial property that has numerous tenants.
Stenprop intends, over the next few years, to sell all of its non-multi-let assets and utilise the sale proceeds to build a UK-focused multi-let business. Multi-let industrials, including Dunball, will now make up 27 percent of its portfolio, but will reach 60 percent to 65 percent by March 2020, the company said.