LXi REIT sells two Travelodge hotels
LXi REIT has sold two Travelodge hotels, in Ipswich and Haverhill, Suffolk, for £12.6m.
The deal reflects an exit yield of 5%, compared to the original purchase yields in 2017 of 5.9% and 6.1%, respectively.
The company has also bought two West Midlands industrial properties for a combined £11.7m, reflecting a net initial yield of 5.7%. The properties comprise two purpose-built bus depots totalling 93,000 sq ft and 102,000 sq ft. One is in the south Birmingham suburb of Yardley Wood and the other is in West Bromwich, north west of Birmingham city centre.
LXi REIT has sold two Travelodge hotels, in Ipswich and Haverhill, Suffolk, for £12.6m.
The deal reflects an exit yield of 5%, compared to the original purchase yields in 2017 of 5.9% and 6.1%, respectively.
The company has also bought two West Midlands industrial properties for a combined £11.7m, reflecting a net initial yield of 5.7%. The properties comprise two purpose-built bus depots totalling 93,000 sq ft and 102,000 sq ft. One is in the south Birmingham suburb of Yardley Wood and the other is in West Bromwich, north west of Birmingham city centre.
Simon Lee, partner of LXi REIT Advisers, said: “We are pleased to have completed the disposal of two Travelodge hotels at a significant premium to acquisition cost and book value and to have immediately recycled the proceeds into two accretive industrial properties let to a strong tenant on 25 year, RPI-linked leases.”
In addition, the firm has exchanged contracts to provide forward funding for the prelet development of an Aldi-anchored property in Evesham, Worcestershire for £12.15m, reflecting a 5.4% net initial yield.
Anchoring the scheme will be a new 18,578 sq ft supermarket, which has been prelet to Aldi on a 15-year lease, with five-yearly upward-only rent reviews. The second unit, comprising 12,935 sq ft, has been prelet to discount retailer Home Bargains, on the same lease terms as Aldi.
The final unit, comprising 10,000 sq ft, has been prelet to discount fashion chain TK Maxx, again on a 15-year lease.
The REIT has also agreed a new 15-year, £75m term loan with Scottish Widows to gear the proceeds of its recent equity issue. The loan has a fixed all-in rate of 2.99% per year until maturity of the facility in December 2033.
Lee said: “Our new 15-year loan facility with Scottish Widows locks in a very attractive 2.99% all-in funding cost over the long term, reflecting the high quality and secure nature of our property portfolio. We continue to deploy the facility across a range of quality assets underpinned by long-term leases, defensive sectors and robust tenants with accretive yields.”
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