M&G has sold food and drink wholesaler Booker’s distribution warehouse in Didcot in Oxfordshire to a private client of boutique investment agency Altitude Investments, for £32.75 million.
The asset is a freehold single let South East distribution warehouse totalling 258,996 sq ft. The building is let to Booker and sits close to the A34 trunk road. The tenant has another eight years on its lease, paying a rent of £2,272,665 per annum on a site of 13.15 acres.
The tenant, with a turnover of over £3 billion, has spent significant capital on the building in recent years, installing a chilled dispatch area of 28,000 sq ft (+2 degrees) and a 36,000 sq ft freezer store (minus 21 to minus 25 degrees).
The centre is occupied by one of Booker’s operations – Chef Direct – and forms one of its regional network of cold distribution hubs to provide chilled and frozen products to a number of well-known brands, schools, hospitals, cinemas and food and beverage outlets.
George Turnbull, director or Altitude, said: “We are very pleased to close this acquisition on behalf of our clients over the summer months. We felt there was value in the market with a number of the institutional players remaining cautious on their investment programmes. The reduced competition allowed for greater leverage from the active and well-funded buyer. An acquisition of this nature over the summer is always a great result to maintain the momentum of the year.
“The asset is a vital part of the Booker/Chef Direct business, their investment in the building shows their commitment to the location. The forecast rental growth in the sector for this region shows the future value opportunities here. We analysed a number of data sources and feel confident of the longer-term prospects of the investment.
“Altitude have had a very strong year so far, transacting circa £60m to date, with another circa £20m under offer. Turnbull added: “We have access to very active funds at present, and continue to seek investments from £5m-plus in the offices, industrial and hotel sectors throughout the UK.”
M&G was advised by Colliers International.