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Custodian REIT purchases car dealership site yielding 6.75%

"We are delighted to have secured this property within Shrewsbury's prime motor retail pitch, let on a long-term lease to a strong tenant," said Richard Shepherd-Cross, managing director of Custodian Capital Limited

TJ Vickers, car dealer
The acquisition resulted in net gearing increasing to 20.8% loan-to-value

UK property company Custodian REIT PLC (LON:CREI) has purchased a car dealership in the Shrewsbury area for £1.67mln.

The 16,770 square feet car dealership is on Battlefield Enterprise Park, Shrewsbury's premier car sales location, four miles from the town centre and five miles from the busy A6 that links Shrewsbury to the West Midlands. Nearby occupiers include Audi, Volkswagen, BMW, Mercedes-Benz, Renault and Ford, Custodian said.

READ: Custodian REIT has cranked rents up by 19% on average over the last year

The property is let to TJ Vickers and Sons Limited on a lease expiring on 31 September 2025 with a current passing rent of £120,000 per annum, reflecting a net initial yield of 6.75%.

“The company has exchanged contracts to acquire an adjacent Audi dealership, which will create economies of scale in managing both properties and assist with any future asset management," said Richard Shepherd-Cross, the managing director of Custodian’s discretionary investment manager.

Quick facts: Custodian REIT

Price: 93 GBX

Market: LSE
Market Cap: £390.65 m

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on 1/5/19

2 min read