AEW UK Long Lease REIT (“the Company”) is pleased to announce that it has purchased two industrial buildings on the Eurolink Industrial Estate, Sittingbourne for £3.9m, reflecting a net initial yield of 6.3%.
The property comprises two warehouse buildings totalling 43,636 sq ft let to Doré Metals Services Southern Ltd, which has had its headquarters on the site since 2007. The lease provides a new 15 year term expiring in September 2033 and has 5 yearly RPI linked rent reviews.
The site is located on the established Eurolink Industrial Estate in central Sittingbourne, with excellent access to the M2 and M20 and one mile from Sittingbourne station. Other occupiers in the vicinity include Everest and B+M Steel. The surrounding area comprises a mix of residential, industrial and commercial uses.
Alex Short, Director of AEW UK Investment Management LLP, and Portfolio Manager of the Company said:
“Demand for industrial property in the South East makes this a great addition to our diverse portfolio. Given this strong demand, we think that the property provides good potential for rental growth over the long term, both from its inflation linked uplifts and in terms of open market levels as well.”
The Company is targeting an annual dividend of 5.5 pence per share paid quarterly, with an ambition to grow in line with UK inflation thereafter.
About AEW UK Long Lease REIT
AEW UK Long Lease REIT plc (LSE: AEWL) aims to generate a sustainable, secure and predictable income return, whilst at least maintaining capital values in real terms, by investing in a diversified portfolio of UK properties, with an attractive entry yield, predominately in alternative and specialist sectors. It will invest in a diverse range of sectors that are underrepresented in institutional portfolios including leisure, healthcare, education, hotels, student accommodation, supported living and automotive. At its IPO on June 6 2017, AEWL raised £80.5m from institutional and retail investors. At least 85% of the gross passing rent from the portfolio’s leases will contain inflation linked rent reviews, and average initial unexpired leases in excess of 18 years at the time of investment.
About AEW UK Investment Management LLP
AEW UK Investment Management LLP employs a well-resourced team comprising 25 individuals covering investment, asset management, operations and strategy. It is part of AEW Group, one of the world’s largest real estate managers, with €59.3bn of assets under management as at 31 March 2018. AEW Group comprises AEW SA and AEW Capital Management L.P., a U.S. registered investment manager and their respective subsidiaries. In Europe, as at 31 March 2018, AEW Group managed nearly €30bn in value in properties of all types located in 15 countries, with close to 400 staff. The Investment Manager is a 50:50 joint venture between the principals of the Investment Manager and AEW.
AEW is one of the world’s largest real estate asset managers, with nearly €60bn of assets under management as at 31 March 2018. AEW has over 600 employees, with its main offices located in Boston, London, Paris and Hong Kong and offers a wide range of real estate investment products including comingled funds, separate accounts and securities mandates across the full spectrum of investment strategies. AEW represents the real estate asset management platform of Natixis Investment Managers, one of the largest asset managers in the world.
As at 31 March 2018, AEW managed nearly €30bn of real estate assets in Europe on behalf of a number of funds and separate accounts. AEW has close to 400 employees based in 10 offices across Europe and has a long track record of successfully implementing Core, Value-Add and Opportunistic investment strategies on behalf of its clients. In the last five years, AEW has invested and divested a total volume of over €17.5bn of real estate across European markets.