Oxenwood Real Estate, the London-based real estate investor, has picked up a portfolio of prime UK logistics assets for £286 million ($366 million; €336 million).
The 3.9 million-square-foot Ultrabox portfolio comprises nine warehouses – of which eight are occupied and one vacant – in cities such as Manchester, Derby, Swansea and Wolverhampton. The largest of the sheds is in Daventry, in the Midlands, and offers almost one million square feet of space.
The annual rent for the eight occupied sheds comes to £4.67 per square foot.
Oxenwood said the acquisition increases the size of its UK logistics portfolio to £430 million. The firm also confirmed the deal was part funded by a £151 million loan from US bank Wells Fargo.
The seller was a joint venture between Lone Star, the Dallas-based private equity firm, and Anglesea Capital, the London-based UK logistics investor.
The portfolio was originally put up for sale in late 2016 and reportedly attracted six unsuccessful bids from Singapore, the US, Australia and South Africa.
“The purchase of the Ulltrabox portfolio represents a significant step forward for the business and further demonstrates our ability to deliver attractive investment opportunities in joint venture,” said Stewart Little, joint chief executive at Oxenwood. “We believe the underlying assets provide an excellent opportunity to deliver further performance over and above the high-quality income streams.”
Jeremy Bishop, also joint chief executive at Oxenwood, said the firm would continue to target UK logistics assets following a recent uptick in backing from its investors.
The bulk of the Ultrabox portfolio emerged from a deal in 2014 that saw Lone Star and Anglesea buy four assets from logistics giant Goodman, totaling 2.4 million square feet. This was followed by a separate deal for three more sites, totaling 930,000 square feet, also from Goodman. The final two assets were added to Ultrabox from Lone Star’s Project Churchill portfolio, acquired from Aviva Investors for £2.2 billion in 2015.
According to research by BNP Paribas in March, take-up in the UK logistics market increased by 10 percent in 2016, taking the country’s total warehouse assets beyond 34 million square feet.
For the Ultrabox deal, Oxenwood was advised by M1 Agency and JLL, while the vendor was instructed by DTRE.