Custodian REIT plc : Purchase of Property

10 September 2018

Custodian REIT plc

("Custodian REIT" or "the Company")

Purchase of Property

Custodian REIT (LSE: CREI), the UK property investment company, is pleased to announce a further property purchase.

The Company has acquired a 72,582 sq ft industrial unit on Hilton Business Park, Derby, located one mile from the A50 which connects the M1 and M6.  Nearby occupiers include Amco Logistics and NR Evans Distribution.

The unit is let to Daher Aerospace Limited on a lease expiring on 14 September 2031 with a current passing rent of £400,060 per annum reflecting a net initial yield[1] of 6.72%.

The agreed purchase price of £5.585 million was funded from the Company's existing debt facilities, resulting in net gearing[2] increasing to 23.3% loan to value.

Commenting on the acquisition, Richard Shepherd-Cross, Managing Director of Custodian Capital Limited (the Company's discretionary investment manager), said:

"We are delighted to have acquired this modern unit located in the developing logistics and distribution corridor of the A50.  There is significant demand in the Midlands for high quality industrial units with good communication links.  Given the affordable level of passing rent and the increasing cost of development limiting the supply of competing space, we expect this demand to lead to rental growth at the September 2021 rent review."

1 Passing rent divided by valuation plus estimated purchasers' costs.

2 Gross borrowings less unrestricted cash divided by last published property portfolio valuation.

-Ends-

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Notes to Editors

Custodian REIT plc is a UK real estate investment trust, which listed on the main market of the London Stock Exchange on 26 March 2014.  Its portfolio comprises properties predominantly let to institutional grade tenants on long leases throughout the UK and is principally characterised by properties with individual values of less than £10 million at acquisition. 

The Company offers investors the opportunity to access a diversified portfolio of UK commercial real estate through a closed-ended fund.  By targeting sub £10 million lot size, regional properties, the Company intends to provide investors with an attractive level of income with the potential for capital growth. 

Custodian Capital Limited is the discretionary investment manager of the Company. 

For more information visit www.custodianreit.com and www.custodiancapital.com.