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Tuesday Feb 09, 2021

Equites sells two UK distribution warehouses to real estate funds

The JSE-LISTED specialist logistics property fund, Equites, has sold two UK distribution warehouses to real estate funds managed by Blackstone for £43.4 million (about R883.9m), representing a 4.79 percent net exit yield and 6 percent premium to Equites' book value.

The sale proceeds would be re-invested into distribution warehouse development by the Equites/Newlands joint venture, with the new warehouses let on 20- and 15-year leases to Hermes and Amazon, a statement said yesterday.

The transaction would realise net cash proceeds of £23.7m to Equites, while lowering the loan-to-value ratio across its portfolio. The new partnership with Newlands in the UK had gained significant momentum, Equites' board said.

"The partnership has recently concluded two development agreements with Amazon and Hermes, with total development costs of £41m and £72m, respectively. The two facilities that Equites will ultimately hold will be brandnew premium logistics facilities, built to institutional standards and let to highquality tenants on long-term leases."

Equites chief executive Andrea TavernaTurisan said they had curated a high quality UK logistics portfolio since entering the UK market in 2016 and the total portfolio value was now in excess of £320m.

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