Real Estate Investors has landed a hat trick of acquisitions across the Midlands.
The Birmingham-based property investment company has bought City Gate House in Leicester, a prime retail unit let to WH Smith in Bromsgrove High Street and the former Sandwell College campus in Smethwick, Sandwell.
The AIM-listed firm has paid £1.8 million for City Gate House in Leicester which is let to the Secretary of State until August 2024 with a tenant break in April 2021 and a current rental of £157,000 per annum.
The Bromsgrove retail unit has been purchased for £500,000 and is let to WH Smiths until June 2017 at £52,000 per annum.
The former Sandwell College campus in Smethwick, Sandwell, which has been bought for an undisclosed sum, totals approximately six acres and is a prime land site zoned for residential development.
REI chief executive Paul Bassi said: “These latest acquisitions bring our spend to £8 million plus so far this year. We have a number of further acquisitions in our pipeline that will see over £20 million invested in a number of opportunities that meet our criteria.
“Additionally, in the first half of 2014, we have secured new lettings totalling £300,000 rental per annum and added new tenants to our portfolio including HSBC, WH Smiths, Royal College of Surgeons, Clark Brookes Turner Cary Solicitors, West Bromwich Building Society, Secretary of State and Duncan Lewis Solicitors.”
He said the commercial property investment marketplace was now substantially improved and the resident market across the region, in particular the West Midlands, is extremly buoyant and he expected this to continue for the foreseeable future.
“It is notable that we have received interest in a number of our properties that were acquired during the downturn, at levels above our book value and we will consider disposals either individually or as a portfolio.
“Land prices are now signficantly higher and we are seeing aggressive and competitive purchasers entering the marketplace for residential development and conversion opportunities.
“In summary, we are making excellent progress across our portfolio and remain on course to maintain our progressive dividend policy,” he said.
Earlier this year, REI reported profits before tax were up by 400 per cent in its financial year to December 31, 2013. This enabled REI to announce it would double its dividend payment for 2013 and the intention to convert to a REIT – Real Estate Investment Trust – possibly as early as 2015.
REI now has just over 700,000 sq ft across 51 buildings with 153 tenants.
The business is now a major Birmingham city centre landlord, with 157,980 sq ft across ten buildings accounting for 37 per cent of the portfolio by value.
Other assets across the Midlands can be found in Edgbaston, Leicester, Derby, Bromsgrove, West Bromwich, Walsall, Kings Heath, Coventry and Rugeley.