Warehouse REIT boosts rents

Warehouse REIT has reported a 15.1% increase in rents in the first three months of its trading year as it completed 27 new deals at a total rent of £4.1m. The group saw the biggest uplift in rents on new deals. It completed 12 new lettings covering 55,000 sq ft at a contracted rent of £515,000 – a 36.7% increase on previous rents. Renewals were also strong, with 10 deals covering 125,000 sq ft supplying £740,000 of new income in the three months to 30 June, a 26.3% increase on previous rents. Rent review increases lagged slightly, with an uplift of 9.9%. Five rent reviews were completed across 450,000 sq ft, providing rent of £2.9m. Notable deals included a new letting to an online grocery store at Stadium Industrial Estate in Luton generating £87,000 of contracted rent, some 37.9% ahead of previous rent; a new letting to an aviation catering business at Gateway Park in Birmingham at a rent of £86,000, some 17.5% ahead of previous rent; and a renewal at Murcar Industrial Estate in Aberdeen to a geo-data specialist at £300,000, an uplift of 11.7% on the previous rent. The REIT also completed the sale of Pikelaw Place, a single-let asset in Skelmersdale, Lancashire, for £4.1m, some 22% above its March 2024 valuation. The group has now sold more than £61m of assets so far this in financial year. Simon Hope, co-founder of Warehouse REIT, said: “We have a well-established track record of capturing reversion and have seen momentum continuing this quarter, supporting our overall goal of increasing dividend coverage by the year end. Looking forward, we see further upside in our portfolio with £7m of embedded reversion as at 31 March 2024.” He added: “Recycling capital out of low yielding or non-core assets where we have delivered our asset management plan, can secure a premium price, and reinvest the capital into well-located, attractively priced warehouse assets where we can capture rental growth through strong asset management, has always been central to our strategy. The sale announced today is an excellent example of that approach and further optimises the portfolio.” Image from Pixabay/Pexels