AEW UK REIT offloads £8.15m Devon retail park
AEW UK REIT has sold Barnstaple Retail Park in Devon for £8.15m, reflecting a net initial yield of 7.5%.
The 51,000 sq ft retail park was originally acquired by AEW UK in October 2015 for £6.79m, reflecting a net initial yield of 8.5%. The 2026 sale price represents a premium of £1.36m, or 20% compared to the purchase price, following landlord capital expenditure over the ownership period of approximately £230,000.
During AEW UK’s, the scheme saw several asset management initiatives that increased income and strengthened the park’s tenant profile. These included lettings to Wren Kitchens and Farmfoods, alongside a lease regear with anchor tenant B&Q. The regear secured a 15-year term certain and increased annual rent by £80,280, contributing to a £900,000 uplift in the property’s valuation in December 2025, equivalent to approximately 12%.
With the next lease event not due until 2029 and rental income broadly in line with market levels, the asset manager considers there to be limited scope for further income growth in the short to medium term.
AEW UK said the sale proceeds will be reinvested in its higher-yielding investment pipeline, in line with its active capital allocation strategy. This is expected to enhance earnings once the acquisitions complete.
Laura Elkin, portfolio manager of AEW UK REIT, said: “The sale of Barnstaple demonstrates our strategy in action: buy well, create value through active asset management, and sell well to reinvest in higher-yielding opportunities with scope to add value and grow income. Through new lettings and the B&Q lease regear, we have materially enhanced the asset’s income profile and investor appeal. With the business plan substantially complete and limited scope for further income growth in the near term, the sale crystallises the value created and enables us to redeploy capital into investments that we expect to enhance Company earnings. We expect to announce acquisitions in the coming months.”