Roadside retail portfolio heads to market with £15.9m price tag
A roadside retail investment portfolio has been brought to market with a price tag of £15,963,000, reflecting a net initial yield of 5.76%.
The ‘Project Pitstop’ portfolio comprises roadside assets located in Northampton, Wednesbury, Oswestry, Warrington, Cardiff, Wakefield, and Willerby (near Hull), all of which are fully let to tenants including Starbucks, Costa, Burger King, KFC, Greggs, IN ‘n’ OUT, Source EV, and Osprey Charging Network.
The portfolio has a total floor area of 26,717 sq ft and produces a topped up rent of £977,699 per annum, reflecting an average rent of £35.34 per sq ft. The weighted average unexpired lease term is 12.2 years to expiry and 10.7 years to break, with 57% of the income benefitting from guaranteed fixed or indexed-linked rental uplifts.
Harris Lamb and Stockford Anderson have been appointed to market the portfolio.
David Walton, head of retail at Harris Lamb, said: “Competition for drive thru sites is fierce, exacerbated by increasing consumer demand for convenience and a limited supply of new opportunities, planning constraints and rising development costs. This is a rare opportunity to acquire a successful, highly prominent and very profitable portfolio of well-let reversionary drive to and drive thru assets.”
The sites also benefit from asset management opportunities, including site densification and repurposing for alternative uses.
Walton added: “We anticipate significant interest in this opportunity from investors keen to capitalise on the rapidly growing drive thru market. Consumer spending within the roadside retail sector has reached around £2.5bn, with 2,256 drive thru outlets currently operating in the UK, with rental values within the field rising by more than 25% year on years and reaching a high of £90 per sq ft in areas where there is a limited supply of such assets.”