UK-based specialist warehouse investor Warehouse REIT has acquired Glasgow International Airport’s Air Cargo Centre from Airport Industrial Nominees for £11.1m.
The purchase price represents a net initial yield of 6.7% and a reversionary yield of more than 7%. The property is owned through a ground lease from Glasgow Airport that will last until 2148.
The estate is arranged across two detached, purpose-built warehouses that span over a 150,000ft² area. It includes eight units given to five separate occupiers with a weighted average unexpired lease term (WAULT) of 6.3 years.
A total net passing rent of £788,086 per annum is generated from the property, equating to an average rent of less than £5.50 per square foot.
The warehouse is currently occupied by Nippon Express (UK), PJH Group and Alpha LSG.
Tilstone Partners managing director Andrew Bird said: “The Air Cargo Centre in Glasgow is an exciting acquisition, highlighting our focus on buying well-located warehouses close to important infrastructure hubs.
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“There remains a constrained supply of airport-related warehouses and yet the purchase continues to represent an investment value less than the cost of replacement. It is the belief of Tilstone that assets such as the Air Cargo Centre represent scarce commodities where rental growth will outperform the wider market indices.
“It is interesting to note that 97% of Warehouse REIT’s assets are less than two miles from a town centre or major transport infrastructure point, characterised as being a main road, railway station port or airport, with the average distance being less than one mile, proving both the urban and logistics nature of our assets.”
Glasgow Airport handled nearly 9.7 million passengers last year, helping to support more than 30,000 jobs across Scotland while generating in excess of £1.44bn per annum for the economy.
Nearly 30 airlines offer services to 100 destinations from Glasgow Airport across the globe.