Tritax EuroBox acquires a 101,555 sqm logistics facility developed by Panattoni Europe
Panattoni Europe announced that Tritax EuroBox, which invests in Continental European logistics real estate assets, has exchanged contracts to acquire a prime, modern national logistics facility at Strykow, Lodz, in central Poland, let to Castorama Polska, one of Europe’s leading DIY retailers and part of Kingfisher plc. The total consideration payable by the company is €55million (excluding purchaser's costs), reflecting a gross initial yield of 5.8 percent on the asset acquisition.
Phase I of this high specification facility, constructed by the developer in 2017 with Castorama in occupation, has a gross internal area of 49,379 sqm. Practical completion of the development targeted for May 2019. Castorama is the market leader and a growing brand in Poland with 76 stores, over 11,000 employees and annual turnover of €1.49 billion. This new facility plays a critical role in Castorama’s national supply chain.
The facility was developed by Panattoni Europe and is strategically located in Strykow, 15km north east of Lodz, Poland’s third largest city, which benefits from excellent infrastructure and connectivity to the country’s road, motorway and rail networks. Central Poland is an established logistics location that has seen rapid take up by numerous blue-chip tenants in the last five years, with continuing high tenant demand and a low vacancy rate. Lodz has benefited from inward investment from numerous multi-national companies and is a hub for manufacturing and commerce, attracting a number of high profile occupiers such as Arvato, DPD, H&M, Lidl, Spedimex and UPS. Poland is one of Europe’s fastest growing economies with a strong and flexible labour pool.
Robert Dobrzycki, Chief Executive Officer Europe, Panattoni Europe commented: "This is another example from a wide range of investment opportunities available in the logistics sector where Panattoni is a key developer and partner to investors and investment managers. The market is driven by profound transformation of the global supply chain and manufacturing patterns. We are very proud to serve such prestigious clients as Castorama (part of Kingfisher Group) and cooperate with the fund Tritax Eurobox."
Upon practical completion, this combined facility will have a total gross internal area of 101,555sqm and will be entirely let to Castorama, with an unexpired lease term of nine years . This well specified cross-docked facility will have a maximum eaves height of 10 metres, significant yard area and parking and a site cover of 42 percent.
Nick Preston, Fund Manager of Tritax EuroBox, added: "We are delighted with our eighth investment for Tritax EuroBox plc, bringing our total invested to over €550 million. This modern high specification national distribution facility let off a low rent to a strong tenant covenant in Castorama and will generate an attractive income return for the next nine years."
Strategically located in an established logistics location in central Poland, this asset benefits from excellent transport and infrastructure connectivity. With strong and growing tenant demand and a constrained supply of available logistics buildings, this off-market investment is at an attractive yield and provides good income growth potential."