Equites Property Fund, the Johannesburg Stock Exchange-listed real estate investment trust, has sold five UK distribution hubs to a fund managed by ICG Real Estate, part of London Stock Exchange-listed global alternative asset manager ICG, for £200.5 million, reflecting a yield of 5.5%.
Equites has sold its UK "springbox" portfolio of assets in its entirety as it refocuses around its core South African logistics platform.
The warehouses are: 100 Scimitar Way, Coventry, let to GXO Logistics; Island Road, Reading, let to DHL International; Unit 3 The Hub, Burgess Hill, let to Roche Diagnostics; Hoyland Common, Barnsley, let to Evri; and Super G, Glasshoughton, let to Puma.
The price paid breaks down to £45,914,500 for the Coventry asset, £29,072,500 for the Reading property, £13,233,000 for Burgess Hill, £76,190,000 for the Hoyland asset, and £36,090,000 the Wakefield property.
In addition, ICG has taken over the entire Aviva debt backing the properties to the tune of £105 million and settled intercompany loans of £85,406,385.
In a statement, Equites said the transaction "marks a decisive step" in its capital recycling strategy, releasing approximately £95.5 million of net cash proceeds that will be reinvested in its "higher yielding South African development pipeline over time". It also reduces the loan-to-value ratio and improves the growth profile of distributable earnings over the long term.
UK industrial and logistics investment volumes reached £913 million in the first quarter of the year, according to DTRE, which said it had been a "quieter start to the year" compared with a surge of activity at the end of last year, when £3.8 billion transacted.
"It is consistent with the seasonal pattern of recent years where capital deployment has been weighted toward the second half," the report added.
EQT Exeter completed the largest deal of the quarter by acquiring "Project Dawn", a portfolio of four single-let assets totalling 909,000 square feet from Prologis for £130 million, reflecting a net initial yield of 5.64%.
ICG was advised by Newmark, while Equites was advised by ACRE Capital Real Estate.