Last-mile Covid-19 demand brings fresh rent to Warehouse REIT

Last-mile logistics investor Warehouse REIT has secured £183,000 of additional rent since the government-imposed lockdown was put into action on 23 March, as demand for space has increased. The REIT said: “The Covid-19 pandemic has led to significant pressure being placed on the UK’s logistics and distribution capabilities, and a number of the company’s tenants are currently experiencing significantly increased trading volumes due to their involvement in the supply of critical goods and services to businesses and consumers. As a result, the company is seeing ongoing demand for its warehouse space.” It added that it was in active discussions with both existing and potential new occupiers for additional space across its 6m sq ft portfolio of 95 assets. The group saw almost three-quarters of its rent for the March quarter day come in, a percentage that increases to 82% when including monthly rent agreements. Warehouse REIT added that it had received only a small number of requests for support form tenants and that it had negotiated alternative payment arrangements where necessary. However, while the logistics sector has faired reasonably well during the coronavirus pandemic, the firm said it was continuing to exercise “financial discipline” to ensure it was well capitalised. At 31 March the firm had £5.5m of cash and £33.5m of headroom on its undrawn facilities. The REIT has an LTV of 39.9% and said that valuations would have to fall by 25% and rental income by 45% before it breached any covenants.   To send feedback, e-mail samantha.mcclary@egi.co.uk or tweet @samanthamcclary or @estatesgazette