The Frontier Key Fund, a joint venture between Frontier Estates Limited and the Chubb Common Investment Fund, have completed the sale of a Waitrose foodstore in Gerrards Cross, Bucks, to the Tameside Metropolitan Borough Council.
The scheme comprises a new development occupied at ground and first floor by Waitrose Limited with 28 luxury apartments forming the upper parts. The foodstore unit comprising of 2,274 sq m/24,447 sq ft was let at a passing rent of £548,000 p.a./£22.42 psf for a term of 20 years from April 2012. Reviews are 5 yearly to the greater of open market value or 3% pa compounded.
The sale price of £11.65m reflects a net initial yield of circa 4.4% after purchaser’s costs. This is believed to be at a record level for similar investments in the region. Frontier Key will retain the head-leasehold interest in the remaining 28 apartments, 22 of which are currently being marketed for sale with prices ranging from £230,000 to £475,000 (£410psf – £550psf).
Will Rees, Development Director with responsibility for the scheme, stated “Frontier Key are very pleased to announce the sale of the completed foodstore to Tameside. Despite current market sentiment, we have achieved a great yield for the property, which reflects the quality of the scheme, tenant and location.
Martin Carey, Rapleys Foodstore Investment Partner stated “competition for foodstore investments in the market remains strong for prime assets such as Gerrards Cross. The quality of income and review structure remain key to achieving yields at these levels.”
Rapleys acted on behalf of the Frontier Key Fund on the letting to Waitrose and the investment sale to Tameside. Briant Champion Long acted for Tameside.