The AEW UK Real Return Fund has announced the purchase of two industrial warehouse units for £6.1m. The first is located in Denbigh West, Milton Keynes, and was purchased for £3.6m, reflecting a 6.3% net initial yield. The second, a unit in Northbank Industrial Park, Irlam, was purchased for £2.5m, reflecting a 6.6% net initial yield.
The first property, Marshall 41, is a 41,505 sq ft self-contained warehouse unit that was recently refurbished. It is situated in Denbigh West, an established industrial estate to the south of Milton Keynes town centre. The estate has received significant investment in recent years, including the development of Stadium MK, Denbigh’s football ground, along with IKEA and Asda stores and Charles Tyrwhitt’s distribution facility. The asset is let to Celestra, a privately-owned IT consultancy and support business. It has an unexpired lease term of 9.7 years.
The second property is a 33,732 sq ft modern self-contained warehouse unit. It is located in Northbank Industrial Park, Irlam, an established manufacturing and distribution location situated midway between Manchester and Warrington, with good access to the North West motorway network. The asset is let to MJ Birtwistles, the butchers and wholesale meat & poultry business. It has an unexpired lease term of 20 years with 5 yearly reviews linked to RPI.
Ian Mason, Portfolio Manager at AEW UK Real Return Fund, commented: “We are very pleased to have completed these two latest acquisitions that complement our existing portfolio. There continues to be a lack of supply for industrial property across the UK and rental growth is showing no signs of abating. We continue to see an attractive pipeline of opportunities across a diverse range of sectors and currently have over £30m under offer. Going forward the Fund will continue to focus on social and demographically driven sectors where long term property fundamentals are strong such as care homes, nurseries and supported living as well as more traditional property sectors where we see value.”
