Investor looks to redevelopment opportunities to up its urban warehouse offering

Investor London Metric has is upping its exposure to redevelopment opportunities through the acquisition of smaller vacant stock and other asset management opportunities to increase its urban warehouse offering.

The company has secured three vacant warehouses in Colliers Wood, Stratford and Stockwell, which it intends to refurbish or redevelop to provide modern Grade A urban warehousing for Greater London.

The acquisition is part of a wider £26.7 million deal which saw the investor secure the three vacant units as well as three others in Hackney, Acton and Thamesmead that are fully let with a WAULT of 11.4 years and have been acquired at a reversionary yield of 4.7%.

The vacant units will be redeveloped or refurbished at an anticipated yield on cost of 4.5%. The assets are expected to generate a total rent of £1.2 million a year.

It has also secured two urban logistics properties for £28.8 million in the Midlands. It has bought a 125,000ft2 urban logistics forward fund development at Crosslink 646 in Leicester, which consists of two units and is expected to complete at the start of 2023.

The largest unit totalling 90,000ft2 is pre-let to EM Pharma on a new 15 year lease at a rent of £7.25 per ft2. The smaller 35,000ft2 unit will be developed speculatively.

In addition it has bought a 9 acre site in that is currently let to Amazon  for vehicle storage for a further five years but has planning consent for a 200,000ft2 distribution warehouse.

Andrew Jones, Chief Executive of LondonMetric, said: “With the logistics market incredibly well bid, we are increasing our investment focus towards smaller opportunities in the strongest urban centres where we can leverage our asset management expertise to significantly enhance returns.”