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PRIVACY
Commercial Property

Property investor AEW 海角视频 REIT makes 拢10m York Micklegate Quarter acquisition

The firm specialises in exploiting what it sees as pricing inefficiencies smaller in commercial properties let on shorter occupational leases

The NCP car park on George Hudson Street which forms part of the unit acquired by AEW 海角视频 REIT.(Image: Google Streetview)

A central York property which includes a prominent car park has been bought in a £10.02m deal.

Real estate company AEW 海角视频 REIT, which has net assets of about £167.1m, has acquired a 99,769 sqft mixed-use building in the city's Micklegate Quarter, near the corner of George Hudson Street and Tanner Row. Among five tenants of the 0.8 acre site is National Car Parks Ltd (NCP), which has operated a 297-space car park there since 2005 and generates about 75% of the property's income.

NCP has nine years remaining on its lease and AEW said the deal reflects a net initial yield of 9.3%. Investors on the London Stock Exchange were told yields could exceed 10% as the lease benefits from a 2027 rent review which will increase rent payable in line with the Retail Price Index, uncapped.

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Laura Elkin, portfolio manager of AEW 海角视频 REIT said: "We are pleased to have purchased this very well-located mixed-use asset at a day one yield that will be accretive to the company's earnings. Our due diligence has shown that NCP trades well from the location and we expect this to continue given the popularity of York as a destination.

"Completion of the acquisition marks the strategic reinvestment into higher yielding assets of capital generated from recent sales. We continue to analyse an interesting pipeline of potential acquisitions and expect to make further purchase announcements in due course, which will bring us closer to our short-term target of full deployment of capital."

AEW pointed to the property being within a 10-minute walk of key visitor attractions, including York Minster, the Yorkshire Museum and the York Dungeon. And prominent shopping sites such as the Coppergate Shopping Centre and Parliament Street. The deal leaves the firm with £15m cash available for further acquisitions.

Last month AEW revealed it had sold two Yorkshire assets in Bradford's Euroway Trading Estate and Lockwood Court in Leeds. The deals made a combined £16.1m and the firm said the sales allowed it to make higher yielding purchases.