LONDON-Andrew Jones, chief executive of newly formed REIT LondonMetric Property plc, is apparnetly happy in the UK. In a follow-up to Friday’s story on the REIT’s first acqusition, Jones goes into detail about the trust’s attack on the market.
(For the original story, click here.)
The plan, at least for the foreseeable future, he says, is to stick to the UK as the investment target of choice. “We believe that the UK offers compelling value with opportunities to acquire well-let and well-located retail, distribution and Greater London real estate assets,” he tells GlobeSt.com.
“There is currently a window of opportunity in selected UK markets to purchase assets that yield 300 to 400bp above debt,” he says. “With modest gearing, these assets have the ability to throw off double digit cash-on-cash returns. We believe this opportunity has not been seen for more than 20 years.”
In terms of the REIT’s hold strategy, Jones says the operation will be opportunistic, “which means we can sell on both an individual asset and portfolio basis,” he says. “Our strategy is to recycle assets, but, because we buy properties with long-term income streams, we are also happy to hold them longer term if market demand weakens significantly.”
And those opportunities are out there and waiting. Jones reports that there is a “strong” pipeline of deals throughout the UK market and he fully plans to “capitalize on those in the first half of 2013.”