SINGAPORE (Feb 28): Cromwell European REIT (CEREIT) is acquiring a light industrial/logistics property in Germany for a consideration of €16.6 million ($25.0 million).
CEREIT will purchase this asset from Nathusius VermögensverwaltungsGmbH& Co. KG and the acquisitions is expected to be completed in April 2020.
The asset is a freehold, light industrial/logistics property totalling 30,557 sqm of net lettable area. It was constructed in 2017 with modern specifications which can easily be repositioned for a multi-tenanted strategy, if required.
Current, the property is fully let to a single tenant Euro Pool System International. The lease, which extends until May 2024, is on a double-net basis, whereby the landlord is only responsible for repairs throughout the duration of the lease.
The asset was independently valued by Cushman & Wakefield Debenham Tie Leung at €16.7 million (approximately $25.0 million), as at Jan 15. Hence the consideration represents about 0.5% below the independent valuation and approximately 50.0% below the estimated replacement cost.
This asset is expected to provide CEREIT with a stable cashflow and WALE of more than four years. The master tenants-customer’s renewal of the lease beyond the four-year term is considered likely as the asset is integral to its operations and it has recently invested €2.8 million in its fit-out in the property.
Simon Garing, CEO of CEREIT’s manager says, ““I am delighted to announce that this is CEREIT’s second light industrial / logistics acquisition in Germany within a short span of three months. The Asset is less than five years old and acquired at an attractive 6.3% NOI yield, a testament to the sourcing capabilities of our extensive on-the-ground European team.”
“This latest addition to our portfolio is underpinned by a lease to a market-leading company specialising in fresh supply chain packaging. This acquisition is consistent with our stated purpose of providing long-term distribution per unit and net asset value per unit growth,” he adds.
As at 10.30am, units in CEREIT are trading at 54 cents.
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