Schroder Real Estate Investment Trust has bought Morgan Sindall House in Rugby, Warwickshire, for £4m – a net initial yield of 8%.
The 36,000 sq ft office building is let to Morgan Sindall as its regional headquarters for 15 years without tenant breaks at rent of £335,000 pa, or an overall rate of £9.30 per sq ft, with a guarantee from Morgan Sindall Group.
The lease benefits from five-yearly upwards-only rent reviews linked to the Retail Price Index, subject to a minimum uplift of 2% pa compound and a maximum uplift of 4% pa compound.
The REIT has also completed the disposal of its 19.5% interest in Merchant Property Unit Trust, generating net proceeds of approximately £3.3m, in line with the net asset value as at 31 December 2013.
MPUT owns a portfolio of 35 builders merchant units throughout the UK let to Travis Perkins.
Following completion of these two transactions the company has cash of £14.2m.
nick.whitten@estatesgazette.com
