LONDON, UK: Schroder European Real Estate Investment Trust has exchanged contracts to purchase a freehold logistics property in Nantes, western France, for €6.15 million, reflecting a net initial yield of 5.5%.
The 8,663 sqm warehouse is fully let to Hachette Livre, a subsidiary of the leading French media group Lagardère, with an unexpired lease term of c. 7 years.
The asset is located in one of France’s fastest growing regions from a GDP and population perspective and is leased at an affordable and sustainable rent level, in an area where there is a scarcity of land for further development.
Located close to the A11/D723 and Nantes ring road, the facility is a strategic distribution hub for Hachette Livre, serving a population of approximately 13 million people across Brittany, Pays de la Loire and Nouvelle-Aquitaine.
Commenting on the acquisition, Laurent Dubos, Head of Real Estate Investment, France at Schroder REIM commented: “We have been seeking to further diversify the Company’s portfolio by both number of assets and tenants, as well as increase its allocation to the high growth industrial sector.
This acquisition achieves these objectives increasing the portfolio’s industrial weighting from 20% to 22%, whilst deploying a portion of the proceeds from the recent sale of Boulogne Billancourt.
The asset location is of strategic importance to the tenant, and one of the most desirable logistics locations in Nantes. Given local supply constraints, it is an area where we expect to see strong rental growth.”
The purchase is subject to a waiver of statutory pre-emption rights in the French market and is therefore expected to complete at the start of August 2021.
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