Schroder Capital UK Real Estate Fund (SCREF) has announced it has completed a 58,320 sq ft pre-let with international delivery and logistics company DPD at Revolution Park in Wolverhampton.
The pre-let to DPD represents 58,320 sq ft of SCREF’s 116,000 sq ft industrial development currently under construction at its assets in Hartlebury and Wolverhampton, as the fund looks to capitalise on inherent opportunities within its existing portfolio. The letting will generate an initial rent of £962,280 per annum on a 25 year lease and practical completion is anticipated to be Q3 2024.
DPD’s new unit at Revolution Park has sustainability at its core with the building designed to a Net Zero Carbon specification, targeting BREEAM Excellent accreditation and an EPC A+ rating. The development will also feature solar panels and electric vehicle charging points which will support DPD’s range of electric delivery vehicles.
The letting to DPD follows on from an active 2021 for SCREF’s industrial portfolio which saw 633,850 sq ft of leasing deals in 58 transactions taking place over the year. The fund also completed a landmark £345m industrial swap deal with SEGRO in October 2021, which saw SREF acquire a portfolio of six multi-let industrial and logistics assets located across the UK, worth a collective £205m.
One of SCREF’s strategic priorities is to grow income through initiatives including developing industrial assets on existing sites and maintaining the portfolio’s defensive qualities through active asset management. New investment has focused on targeting higher sustainable yields, achieving rents ahead of ERVs, and capitalising on opportunities driven by structural change, such as demographic change and the growth of new technology, as well as the growing demand for assets with high sustainability credentials.
Jessica Berney, Fund Manager of Schroder Capital UK Real Estate Fund at Schroders Capital, said: “To cater for the growing demand for industrial space we are continuing to develop and refurbish our existing industrial assets across the UK. This allows us to increase our exposure to the sector without having to pay high prices for new assets in a very competitive market.
“Major pre-lets such as the lease with DPD at Wolverhampton de-risks the development of new industrial assets and follows a similar pre-let we completed with ETAC for a purpose-built 30,000 sq ft distribution facility at Hartlebury Trading Estate. Thanks to our industrial team’s active asset management and close relationships with occupiers, the fund has identified opportunities across our portfolio where we can develop new assets and provide more space for new and existing tenants.”
DPD’s new facility at Revolution Park will be one part of the four-unit 200,000 sq ft industrial development at the Wolverhampton site, where SCREF is working with development partner Trebor Developments to create one of the most sustainable and efficient buildings within its industrial portfolio.
Commenting on the letting to DPD, Greg Dalton Development Manager for Trebor Developments added: “It’s fantastic to have agreed terms with DPD so soon after the site’s formal launch to market and we’re delighted to be working with Schroders to see this important brownfield site in the Black Country fully redeveloped so soon. Furthermore, DPD support Trebor and Schroders’ ambition to invest heavily in sustainable initiatives and resources, and the unit will create a best-in-class asset for all parties involved.”
Louise Ferguson, Head of Property for DPDgroup UK Ltd, commented: “We are absolutely delighted to agree terms for a new, purpose-built DPD distribution centre at Revolution Park. It is a great location for us. The new facility is part of DPD’s strategy to be the most responsible and sustainable city centre delivery company and a leader in the move to electric deliver vehicles in the UK. We have invested heavily in our regional network in the last ten years to meet the huge increase in demand for our services and this new facility will allow us to offer an even better service to the area, with more efficient fleet, shorter journeys and lower emissions.”
