Schroders and Zurich buy Romford’s Brewery for £162m
Schroder UK Real Estate Fund and Zurich Investment Foundation Immobilien Europa Direkt have teamed up to buy the Brewery in Romford, Greater London, for £162m from Nuveen Real Estate.
The Brewery comprises a 21-acre site with 545,478 sq ft of retail and leisure space. Its tenant line-up includes a Sainsbury’s superstore, Nuffield Health, the Range, Boots, Pure Gym, a 16-screen Vue Cinema and several food and beverage outlets including Wagamama, Starbucks and Costa Coffee.
The location was bought at a 7.3% initial yield, in a 50-50 joint venture. It also has 1,750 car parking spaces.
Schroder UK Real Estate Fund and Zurich Investment Foundation Immobilien Europa Direkt have teamed up to buy the Brewery in Romford, Greater London, for £162m from Nuveen Real Estate.
The Brewery comprises a 21-acre site with 545,478 sq ft of retail and leisure space. Its tenant line-up includes a Sainsbury’s superstore, Nuffield Health, the Range, Boots, Pure Gym, a 16-screen Vue Cinema and several food and beverage outlets including Wagamama, Starbucks and Costa Coffee.
The location was bought at a 7.3% initial yield, in a 50-50 joint venture. It also has 1,750 car parking spaces.
Schroders outlined its expectations that retail park rents will stabilise, highlighting that customer footfall at retail parks is 3% ahead of pre-pandemic levels.
Jessica Berney, fund manager for SREF, Schroders Capital, said: “The asset offers an attractive initial yield for the fund and is in line with several of the fund’s objectives including growing income returns, increasing exposure in sectors expected to outperform, strengthening future capital performance potential, and improving the portfolio’s sustainability credentials.”
Harry Pickering, head of UK retail at Schroders Capital, said: “The Brewery is an exciting opportunity, showcasing the best of what retail warehousing should be; well located, a strong trading performance, affordable rents and ample opportunities to perform asset management initiatives both in the short and longer term, to create long-term sustainable income growth and strong returns for SREF.”
Pickering also highlighted the location’s scope as a “strategic retailing hub” for click and collect, fulfilment and convenience destinations.
Roger Hennig, fund manager for Zurich Investment Foundation IED, which is a pan-European strategy managed by Schroders Capital, said: “This food-anchored, retail warehouse and leisure scheme represents an attractive addition to the portfolio. The asset provides a strong income yield and will further diversify the portfolio, which has now increased in value to over €1.5bn.
“The joint venture with the Schroder UK Real Estate Fund will ensure that both partners can capitalise on the significant retail and placemaking expertise of the Schroders team to deliver performance from the asset going forward.”
HampsonWall, CSP, Montagu Evans and Stephenson Harwood acted for the joint venture on the acquisition.
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