UK Industrial Portfolio Brings $104M

LONDON—Hansteen Holdings PLC, a UK and Continental European property investment company, has sold a portfolio from the Ashtenne Industrial Fund, in which it has a 36.7% interest, for a total of $104 million (£62M) to Rockspring Hanover Property Unit Trust, reflecting a net initial yield of 7.5%.

The portfolio comprises ten multi-tenant industrial properties and one office park, located predominantly in the South East of England, totaling 171 units and nearly 900,000 sq ft. The occupancy rate is 91% and the assets are let to 120 tenants including HSBC bank, Virgin Media and Halfords Autocentres, generating an annual net rental income of $8.2 million £4.9M.

This is the first portfolio from the $823 million (£490M). Ashtenne Industrial Fund to be sold since Hansteen was appointed as asset manager on the fund in August 2013.

Mark Ovens, director (UK) of Hansteen, commented: “Bidding for this portfolio was extremely competitive, which reflects the strength of the multi-let industrial market. We believe this sector will continue to experience yield compression and rental growth because of sustained occupier and investor demand”.

Hansteen was advised by DTZ on the transaction. Rockspring was advised by Fletcher King and Caisson.

The portfolio comprises:

-        Mountbatten Business Park, Portsmouth – 21 units totaling over 130,000 sq ft

-        Mill Lane Industrial Estate, Alton – 17 units totaling nearly 123,000 sq ft

-        Lloyd's Court, Manor Royal – 20 units totaling nearly 52,000 sq ft

-        Units 3 & 4 Brittingham House, Crawley – 4 units totaling nearly 7,000 sq ft

-        April Court, Crowborough – 17 units totaling over 31,000 sq ft

-        Witan Park Industrial Estate, Witney – 11 units totaling nearly 112,000 sq ft

-        Barking Business Centre, Barking – 34 units totaling over 84,000 sq ft

-        Roydonbury Industrial Estate, Harlow – 7 units totaling nearly 92,000 sq ft

-        Units 1-4 Crammond Park, Harlow – 4 units totaling nearly 63,000 sq ft

-        Babbage Road & Motorway Industrial Estate, Stevenage – 7 units totaling nearly 73,000 sq ft

-        Hellesdon Hall Industrial Park, Norwich – 29 units totalling 128,000 sq ft

The Ashtenne Industrial Fund was originally formed in July 2001 when Ian Watson and Morgan Jones, founders of Hansteen, were Joint Chief Executives of Ashtenne Holdings PLC. AIF owns over 14.6 million sq ft of multi let industrial properties in the UK. The portfolio has over 3,000 units, on 240 individual estates, with an annual rent roll of $75 million (£44.2M) and a current vacancy of 17%. As of March 31, the gross asset value of the properties was $823 million. Hansteen was appointed asset manager of AIF in August 2013 and acquired a 26.3% stake in the Fund. Hansteen then increased its interest in AIF to 36.7% in March 2014.

Hansteen Holdings PLC is a European industrial REIT that invests in properties with high yields, low capital costs and opportunity for value improvement across Germany, the UK, the Netherlands, Belgium and France.