LOGISTICS PROPERTY TODAY - King Sturge
LOGISTICS PROPERTY TODAY - King Sturge
LOGISTICS PROPERTY TODAY - King Sturge
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RENTS<br />
The South East dominates prime rents for large logistics facilities at £6.50-8.50 per<br />
ft², followed by the West Midlands at £5.75-6.50 per ft². Elsewhere in Britain, prime<br />
rents range from £4.00 - £4.50 per ft² in the North East to £4.75 – 5.50 per ft² in the<br />
South West.<br />
Prime logistics rents<br />
Region £ per ft²<br />
South East (excluding Heathrow) 6.50-8.50<br />
West Midlands 5.75-6.50<br />
East Anglia 5.00-5.50<br />
South West 4.75-5.50<br />
East Midlands 4.50-5.25<br />
North West 4.25-4.75<br />
Yorkshire & Humberside 4.25-4.50<br />
Scotland 5.25-5.75<br />
Wales 4.25-4.50<br />
North East 4.00-4.50<br />
Note: Based on a minimum ten-year lease<br />
INVESTMENT COMMENT<br />
There continues to be strong investor demand for large distribution facilities. As a result<br />
the downward pressure on yields has continued. Prime yields are around 5.5% or better,<br />
assuming a 15-year lease, with yields between 6.0% and 6.5% for five-year income.<br />
Evidence of 10-year income includes the sale of TNT at Magna Park, Lutterworth.<br />
Pickering Properties acquired this unit of 229,213 ft² by way of a forward commitment<br />
for £23.1m, equating to 5.3% NIY.<br />
Also at Magna Park, Pickering Properties bought by way of a forward commitment a<br />
unit which will be occupied by Geodis. The lease term agreed is 10 years with a tenant’s<br />
break at year 5. The purchase price equates to 6.12% NIY.<br />
All data contained in this report has been compiled by <strong>King</strong> <strong>Sturge</strong> LLP and is published for general information purposes only. While<br />
every effort has been made to ensure the accuracy of the data and other material contained in this report, <strong>King</strong> <strong>Sturge</strong> LLP does not<br />
accept any liability (whether in contract, tort or otherwise) to any person for any loss or damage suffered as a result of any errors or<br />
omissions. The information, opinions and forecasts set out in the report should not be relied upon to replace professional advice on<br />
specific matters, and no responsibility for loss occasioned to any person acting, or refraining from acting, as a result of any material in<br />
this publication can be accepted by <strong>King</strong> <strong>Sturge</strong> LLP.<br />
© <strong>King</strong> <strong>Sturge</strong> LLP November 2006<br />
This publication is printed on recycled, post-consumer fibre, totally chlorine free paper produced from sustainable stock.<br />
FSC certification.<br />
www.kingsturge.com<br />
UK Logistics Team<br />
National<br />
David Brooks – Manchester<br />
Tel: 0161 238 6239<br />
Tim Johnson – London<br />
Tel: 020 7087 5300<br />
Carl Durrant – Midlands<br />
Tel: 0121 200 7147<br />
Jon Sleeman – Research &<br />
Consultancy<br />
Tel: 020 7087 5515<br />
Regional<br />
Jim Frankis – South East<br />
Tel: 020 7087 5311<br />
Andy Harding – South East<br />
Tel: 020 7087 5310<br />
Steven Johnson – North West<br />
Tel: 0161 238 6238<br />
Simon Hill – North East<br />
Tel: 0191 279 0006<br />
Daniel Martin – Yorkshire &<br />
Humberside<br />
Tel: 0113 235 5222<br />
Jeremy Sutton – South West<br />
Tel: 01793 553963<br />
Paul Baker – South West<br />
Tel: 0117 930 5780<br />
Chris Sutton – Wales<br />
Tel: 029 2072 6014<br />
Douglas Patrick – Scotland (West)<br />
Tel: 0141 225 0503<br />
Kirsty Palmer – Scotland (East)<br />
Tel: 0131 247 4702<br />
If you require further information on<br />
this publication, please contact Emma<br />
Jackson in the Research Department<br />
on 020 7087 5518<br />
or by email:<br />
emma.jackson@kingsturge.com
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