Custodian Property Income REIT has acquired family company Scorpion Properties for £8.5m.
One of the Scorpion assets acquired by Custodian Property Income REIT
Scorpion’s portfolio comprises five industrial properties: four are let to vehicle repair business Steer Automotive and one is let to distributor Euro Car Parts.
The assets, which have an average value of £1.7m, are located in the south Midlands along the M40 corridor.
The portfolio generates an annual aggregate passing rent of £600,000, adding 1.3% to Custodian’s annual rent roll.
Richard Shepherd-Cross, managing director at Custodian Capital, the company’s investment manager, said: “Following so shortly after our recent acquisition of Grove Court, the transaction is a further statement of our ambition to continue scaling the business using the strong blueprint we set in last year’s Merlin acquisition.
“It also provides further evidence of the solution we offer to family offices seeking to exit or simplify the ownership structure of their property holdings by utilising the benefits of our listed REIT status as well as our focus on high-quality, smaller lot-size investments, which offer an attractive yield premium over larger assets, with little or no more associated risk.”
He added: “We will continue to progress our pipeline of similar opportunities in line with our growth strategy and against a challenging but improving capital markets backdrop.”
David MacLellan, chairman of Custodian Property Income REIT, said: “The circa 20% increase in the company’s share price since October last year makes these types of transactions more appealing.
“Long-established family-owned businesses find the investment manager’s expertise in property, combined with the attractiveness and simplicity of owning property via listed shares that deliver a high, consistent quarterly dividend, very compelling.”
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