Established property developer Segro has announced the purchase of a 13-acre warehouse estate in London’s Canning Town.
Purchased from Schroders for £133 million, the estate is in a prime location, close to Canary Wharf and London City Airport, the property is also within walking distance of three Zone 2/3 London Underground stations allowing easy access for workers on the estate.
Commenting on the purchase, Alan Holland, Business Unit Director for SEGRO’s Greater London portfolio, said: “This acquisition is an exciting opportunity for SEGRO to consolidate its leading London footprint and is a strong fit with its well established prime urban warehouse portfolio.
“Situated on the edge of Zone 2, at the gateway between Central London and the rest of our East London assets, it is in an area that is currently undergoing significant redevelopment and modernisation. This should further improve the already attractive supply/ demand dynamics and create the potential for strong rental growth, as we have seen happen in other inner London markets.”
Electra Park provides 21,200 sq m of lettable space across 10 units of which nine are let, with the final unit currently under offer.
The weighted average unexpired lease term (WAULT) on the let space is 4.3 years to break and 6.4 years to expiry.
The estate generates a topped-up passing rent of £3.4 million, reflecting a low average in-place rent of approximately £14 per square foot with an estimated ERV of £21 per square foot.
Alan adds: “Electra Park helps us to build further scale in an area where we have made great progress through the East Plus partnership in conjunction with the Greater London Authority. This enables us to improve choice and provide an excellent customer experience as well as represents an opportunity for us to create value by applying our asset management expertise and knowledge of the local market.”
SEGRO was advised by JLL – Schroders were advised by Gerald Eve.