Warehouse REIT acquires chunk of Tamworth retail park

Warehouse REIT, the real estate investment trust which focuses on investing in multi-let assets in industrial hubs, has acquired Phase 2 of Ventura Retail Park in Tamworth, near Birmingham, for £38.6m.

Ventura Retail Park is one of the 20 largest retail parks in the UK by area, with Phase 2 comprising 120,000 sq ft of fully-let retail space.

The asset – which is let to the likes of Boots, Sports Direct, and H&M – produces a contracted rent of £3.1m per annum and has a weighted average unexpired lease term of 6.4 years.

The retail park forms part of a wider retail warehouse cluster covering 700,000 sq ft, with occupiers including Next, Primark, and M&S.

Warehouse REIT said the acquisition is in line with its focus on multi-let assets. The group added that its management team has a strong track record of investing in and managing retail warehouses which, coupled with its experience in multi-let retail warehousing, makes the acquisition highly complimentary to the group’s portfolio.

The REIT recently announced that it had completed £165 million of sales since announcing a disposal plan in November 2022, reducing its net debt to c.£235 million prior to this transaction. The group said it will remain disciplined in its approach to ensure that leverage and finance costs remain low and manageable.

Simon Hope, director at Warehouse REIT, said: “This was a rare opportunity to acquire an asset that will be earnings enhancing in year one.  Retail warehousing is a sector where we have deep experience, and which plays to our strengths in multi-let asset management. Rents have rebased and are now starting to grow, while pricing remains attractive relative to equivalent assets on the multi-let industrial side, which should support earnings and help rebuild dividend cover – a key priority for this business.”