Custodian acquires Gloucester retail warehouse

UK property investment company Custodian REIT announced a further property purchase on Tuesday, confirming it had acquired a 22,663 sq ft retail warehouse on Southbrook Retail Park, Gloucester, near the town centre and within three miles of the M5.

The London-listed firm said the site comprised two units occupied by Magnet and Smyths Toys, with nearby retailers including Halfords, B&M Bargains, Lidl, The Range and McDonalds.

It said the units' leases expire on 9 September 2024 and 28 September 2021 respectively, with a total passing rent of £373,100 per annum, reflecting a net initial yield of 7.41%.

The agreed purchase price of £4.725m was funded from the company's existing cash resources, resulting in net gearing increasing to 15.7% loan to value.

“We are delighted to have secured this prominently located property within Gloucester's prime out of town retail pitch,” said Richard Shepherd-Cross, managing director of the company’s adviser Custodia Capital.

“Magnet and Smyths Toys are both strong nationally established tenants who add to Custodian REIT's retail warehouse portfolio.

“Magnet has been in occupation since the unit was constructed and Smyths Toys has recently undertaken a substantial fit out of the property demonstrating its commitment to the location.”