LondonMetric cuts warehouse exposure with £145m sell-off

LondonMetric Property said it had sold two mega box and two regional distribution warehouses, in three deals, for a combined £145.3m as it moved to cut its exposure to lower income growth assets.

The company said it had sold a mega warehouse in Newark to an unnamed international investor for £80.8m, reflecting a net interest yield (NIY) of 5.1%, two distribution assets in Doncaster to an overseas buyer for £51.2m (NIY 6.2%) and a regional distribution warehouse in Rotherham to a global investor for £13.3m (NIY 5%).

The total sum reflects a 2.6% discount to book value on September 30. Following the sales, LondonMetric's big box warehousing will represent 14% of its portfolio, across three assets.

Chief executive Andrew Jones said the company had “taken the opportunity to respond to global investor demand for distribution warehousing to monetise some of our larger assets” in areas where it expected income growth “to be more muted”.

“The sales further improve the income diversification of our largest occupiers and provides headroom to invest further into urban logistics, which continues to offer superior income growth prospects," he said.