Warehouse REIT completes property sales to reshape portfolio and boost dividends

Warehouse REIT, the real estate investment trust, has completed £57.5m worth of sales as it looks to reshape its portfolio and increase its dividend coverage.

The London-listed REIT said on Monday that it had disposed of single-let assets in three separate transactions: Barlborough Links in Chesterfield for £46m, Parkway Industrial Estate in Plymouth for £6.3m and Celtic Business Park in Newport for £5.2m.

Warehouse REIT said the combined sale price was in line with the 31 March 2024 valuation and represented a net yield on passing rent of 5.8 per cent.

The REIT has now made £165.2m worth of total sales since it announced a deleveraging plan in November 2022.

It said that the latest sales were in line with its strategy of weighting its portfolio more towards the multi-let warehouse asset class, which can suit a wider range of occupiers and provide faster access to rental reversion.

After the new sales, the portfolio’s multi-let weighting has risen from around 70 per cent as of 30 September 2023 to roughly 77 per cent on a pro forma basis.

Simon Hope, for Warehouse REIT, commented: “Rebuilding dividend coverage is our key priority, and by reducing our debt and our finance costs, the sale of these single-let assets is an important milestone in that respect.

“At the same time, we continue to reshape our portfolio to focus on the highly attractive multi-let subsector of UK real estate, which plays to our strengths and is where we can drive income and capital growth over the long term.”

Warehouse REIT added that it remained committed to extracting value from its Radway Green development site in Crewe, where it said negotiations were progressing well.

On Tuesday, the REIT is due to announce its full year results for the 12 months ending on 31 March 2024.

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