Tritax Big Box buys Doncaster distribution centre

BBOX : Tritax Big Box buys Doncaster distribution centre

Tritax Big Box REIT is buying The Range UK National Distribution Centre at Nimbus Park, Thorne, Doncaster for a purchase price of £48.5m (a net initial yield of 6.1%).

Thorne is about 7 miles to the north east of Doncaster town centre, adjacent to the M18 motorway and 2 miles from Junction 6, which provides easy access to the wider motorway network of M1, A1(M) and M62. They say the immediate location has a strong critical mass of occupiers (such as B&Q, Asda, Next, DFS and Ikea) which underpins the longevity of the area as a major UK distribution location, supported by the favourable demographics for a suitable labour force.

The property was constructed in 2006. sits on 42.7 ac res and has 750,431 sq ft of logistics infrastructure and ancillary offices. The warehouse has an eaves height of 15.8 metres. The distribution centre is being acquired with an unexpired lease term of approximately 18 years, which is subject to fixed increases of 2% pa compounded and received 5 yearly. The next rent review is due on 1 October 2017.

Barclays bank are providing £24.25m of senior secured debt to help finance the acquisition (a 50% LTV) for a term of five years, with an option to extend up to a maximum of seven years. Following drawdown of the loan, Tritax’s aggregate borrowings will be 34.8% of gross assets with a blended margin approximately 1.77% above three month LIBOR.

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