Leicester-based property investor Custodian REIT, has announced the disposal of an industrial unit in Kilmarnock at auction for £1.4 million at a 12% premium to its 30th June 2022 valuation.
The group aims to deliver a strong income return by investing in a diversified portfolio of smaller regional properties across the UK, and say the environmental credentials of the 18,424 sq ft warehouse and distribution unit no longer fit with the Company’s ESG objectives and it was not considered practical to mitigate these risks. Having recently increased the lease term by 10 years it was considered the right time to sell and crystallise a valuation uplift.
Commenting on the disposal, Richard Shepherd-Cross, Managing Director of Custodian Capital Limited (the Company’s external fund manager), said: “The sale of this industrial unit at a premium to valuation demonstrates the ongoing liquidity in the market for smaller lot sized commercial real estate, underscoring our investment thesis. Having acquired this property as part of our IPO portfolio eight years ago and having recently increased the lease term until 2032, we felt that now was an opportune time to crystallise the value we have created. The proceeds of the disposal will be recycled into identified improvements to the remaining portfolio which we believe will be more accretive and better support the strategy of providing shareholders with strong income returns.”
