Schroder Real Estate

Schroder Real Estate Investment Trust Ltd - Industrial Asset Management Update

For release 30 March 2021

Schroder Real Estate Investment Trust Limited
("SREIT"/ the "Company" / "Group")

INDUSTRIAL ASSET MANAGEMENT UPDATE

Schroder Real Estate Investment Trust, the actively managed UK-focused REIT, provides an update on recent asset management activity across its industrial portfolio, which, following two significant recent acquisitions, is now its largest sector weighting representing 37% of portfolio value as at 31 December 2020.

A further four new lettings and renewals have completed since February 2021. These increase contracted rental income by £192,000 per annum and reflect a 15% average uplift on the previous passing rent or Estimated Rental Value (‘ERV’) for the newly developed units.

Milton Keynes, Stacey Bushes Industrial Estate

Stacey Bushes Industrial Estate in Milton Keynes is the Company’s largest asset and comprises 67 units across 360,000 sq ft. As at 31 December 2020 the asset was valued at £43.4 million.

A new three year lease has completed with Strata Communication, trading as Polestar Volvo, for 8,100 sq ft across three recently completed new warehouse units. The combined rent is £113,500 per annum, or £14.00 per sq ft.  This compares with the ERV of £97,200 per annum.  The lease includes annual break options and the tenant received no incentives. 

A new five year lease has completed with Prototrim for an 8,000 sq ft unit at a rent of £60,000 per sq ft, or £7.50 per sq ft. This compares with the previous passing rent of £45,500 per annum and is in line with ERV. The tenant will receive three months’ rent free and there is a break option in year three.

A new three year lease has completed with Cityfibre Holdings for 1,525 sq ft at a rent of £16,000 per annum, or £10.50 per sq ft. This compares with the previous passing rent and ERV of £15,250 per annum.

Norwich, Union Park Industrial Estate

Union Park Industrial Estate in Norwich is the Company’s eighth largest asset and comprises 31 units across 269,000 sq ft. As at 31 December 2020 the asset was valued at £17.9 million.

A three year lease renewal has completed with Norscan Stainless for 6,720 sq ft at a rent of £38,000 per annum, or £5.64 per sq ft. This represents an uplift of 8%.

Cheadle, Stanley Green Trading Estate

In December 2020, the Company acquired Stanley Green Trading Estate in South Manchester for £17.25 million, which comprises 150,000 sq ft of existing trade and warehouse accommodation together with an adjoining 3.4 acre, non-income producing, development site.

A planning application has been submitted for an 80,000 sq ft, 11 unit trade counter and warehouse scheme on the development site. The proposed scheme will be developed to a high standard of sustainability performance including targeting a BREEAM Excellent accreditation, an EPC A+ specification and being operationally net zero carbon.

The site had a historic planning consent for 48,500 sq ft and is already allocated for industrial development in the Local Plan. A decision is expected during the first half of 2021 and, if approved, development should commence shortly afterwards with completion targeted for late 2022. The construction contract will be tendered shortly with an estimated total development cost of £8 million. The ERV for the newly developed units will be approximately £950,000 per annum.

-ENDS-

For further information:

Schroder Real Estate Investment Management Limited:
Nick Montgomery / Frank Sanderson
020 7658 6000
Northern Trust:
Jingjing Qi
01481 745529
FTI Consulting:
Dido Laurimore / Richard Gotla / Meth Tanyanyiwa
020 3727 1000