A client fund of DTZ Investors has acquired the freehold interest in a four unit mid-box industrial estate on Pegasus Road, Croydon, for £23,750,000 from a UK pension fund, in a deal reflecting a net initial yield of 4.35%.
The units are let to London Fire Brigade, Iveco, Bunzl and Brewers Decorators with an weighted unexpired lease term of nearly 10 years to lease expiries.
Three of the units are let for circa £13/sq ft showing significant reversion with prime rents in the local area now at more than £20/sq ft. It is believed that the transaction will show a running yield of more than 5.5% at reversion.
Ewan Stewart, acquisition manager at DTZ Investors, said “We’re really pleased to have acquired Pegasus Road. Long leases to strong covenants at affordable rents in a core London location were particularly attractive. We hope this acquisition will be one of many this year for DTZ Investors, as we have several mandates with active capital to deploy for similar types of investments.”
DTZ Investors was represented by Lewis Ellis and the vendor was represented by Clay Street.
