Tritax Big Box REIT (BBOX) has agreed a cash and share deal to acquire a £1.04bn logistics portfolio from Blackstone Europe.
The deal comprises £632m in cash to be funded via a new £650m debt facility and circa £375m of new ordinary shares in BBOX to be issued at a price of 161p per share.
The portfolio comprises 32 urban logistics/small box and nine big box assets located in core regions across the UK with a 36% weighting to the South East.
The portfolio has an aggregate passing rent of approximately £53m per annum and is 95% occupied with a weighted average unexpired leased term of 5.9 years.
The assets within the portfolio have an average passing rent of £8.23/sq ft and an ERV of £10.49/sq ft.
Colin Godfrey, CEO of BBOX CEO, said: “Aligned with our strategic objectives, this exceptional portfolio offers strong rental reversion and numerous asset management opportunities. It also significantly broadens our client proposition across key urban logistics markets and reinforces our leading position in mission critical big boxes; in combination growing our GAV to over £7.9bn.
“The acquisition also delivers immediate financial benefits, including mid-single-digit EPS accretion and enhanced returns well above our cost of capital. I welcome Blackstone as a new 8.6% shareholder in Tritax Big Box; their investment at a material share price premium demonstrates confidence in our team, our leading position in UK logistics, the strong attributes of the transaction and positive outlook for both our business and the market.”
James Seppala, chairman of Blackstone Europe and the head of real estate Europe, added: “This transaction reflects our conviction in BBOX and its market-leading position, as well as our continued conviction in the UK logistics sector. This portfolio represents a rare aggregation of high-quality properties with meaningful embedded rental growth potential. The Tritax team’s strong asset management track record make them an excellent steward for these assets in the future.
“Our decision to take an ownership stake in BBOX as part of this transaction reflects our belief in the company’s long-term strategy and outlook, and we are excited by the opportunity to participate in the future success of the enlarged business.”
