Property company LondonMetric today reports a £35.4m investment in three sites for urban logistics in the south east and south west of the UK.
Stockmarket-listed real estate investment trust and property manager LondonMetric today said it had bought a 130,000 sq ft site in Worthing for £19m in a sale and leaseback from audio technology business Bowers & Wilkins, which uses the site for its headquarters, manufacturing and distribution. It has also spent £10.3m on a 50,000 sq ft site in Uckfield, already leased to John Lewis for the next 15 years, and £6.1m on a 47,000 sq ft site in Exeter, already leased to Jewson for the next 17 years. The site is close to the junction of the M5 and A30 and has, says LondonMetric, potential for redevelopment and rent reviews from 2022. Currently the three sites generate a rent of £1.7m a year.
Andrew Jones, chief executive of LondonMetric, says: “These urban logistics assets are in good locations and let on long leases with certainty of income growth. We are continuing to find attractive opportunities for redeploying capital into our preferred sectors of urban logistics and grocery-led long income.”
Last week, the company invested £11.1m in an urban logistics warehouse in Cardiff.
The move comes soon after property developer British Land said it was recalibrating its retail strategy as it invested in two sites with the potential to create last mile logistics hubs – £20m for Finsbury Square Car Park in London, and £82m in a shopping park in Thurrock. The deals by British Land and, today, LondonMetric, come as shoppers continue to do more of their shopping online than before the pandemic – and as more delivery companies, from Getir to Deliveroo, expand their mission of offering ever faster fulfilment, particularly in the grocery and pharmacy sectors. Grocers from Morrisons to Aldi and chemists from Lloyds Pharmacy to Boots now use Deliveroo – among others – to get shoppers’ small grocery orders to them fast – benefitting from their inbuilt advantage of having stores. The task is more complicated for pureplay retailers and delivery apps that deliver from their own micro-depots. Ocado Zoom, for example, aims to have a network of more than a dozen micro-fulfilment sites in London from which it can deliver in as fast as an hour, but has encountered problems in finding suitable sites.