AEW UK REIT makes first acquisition

Mobis Drive, Fiera Properties

AEW UK REIT has made its first acquisition, buying a business park near Oxford for £8.2m.

The new listed property company was admitted to trading on the London Stock Exchange last month after raising £100.5m.

The acquisition of Eastpoint Business Park, which comprises five self-contained office buildings totalling 75,000 sq ft, reflected a yield of 9.4%. The seller was Angle Property funded by Palmer Capital.

The average weighted unexpired lease term of the tenants, who include Clarendon Business Centres and Cancer Partners UK, is six years to break and 7.9 years to expiry.

In addition to the acquisition, AEW UK REIT has invested £9.75m in the AEW UK Core Property Fund.

Portfolio manager Alex Short said AEW UK REIT, which will target a net dividend yield on the issue price of 8-9%, had also agreed terms on several other properties.

“After the successful raise of £100m last month, it is good to get the first acquisition completed,” she said.

“We have agreed terms on our next few acquisitions as well so we hope to be able to make further announcements over the coming weeks.  In addition, we are currently monitoring a very interesting pipeline of both single properties and portfolios across a range of sectors and locations that we believe will be able to create a very strong and varied basis for the company.”

AEW was advised by Tudor Toone with Lambert Smith Hampton acting for the vendor.

Author: Guy Montague-Jones, Property Week