SEGRO acquires portfolio of offices in Slough for £425m
SEGRO plc has purchased a portfolio of offices located across the Bath Road in Slough, UK, from clients of AEW for a price of £425 million.
According to the British property investment and development company, the portfolio brings 89,000sqm of built space spanning 39 acres of land. It has a passing rent of £20 million, which reflects a net initial yield of 4.6%, said SEGRO.
Previously, SEGRO had developed the office portfolio and divested it in January 2016 as part of the company’s strategy to dispose of non-core assets. The proceeds from the sale were reinvested into its development pipeline.
Since the sale of the office portfolio, the Slough Trading Estate has provided a capital value growth of 59% and as of June 2021, had a valuation of £2.2 billion.
According to SEGRO, the ageing nature of the portfolio and the comparatively short lease terms of certain offices means that the acquisition will boost its ability to meet rising customer demand for data centres, life science occupiers, creative industries, and other possible industrial space users in Slough.
David Sleath — SEGRO Chief Executive said: “Over recent years we have seen a transformation in the nature and level of occupier demand for industrial, data centre and other uses of space in Slough. Since 2016, we have created over 96,000 sq m of new industrial space on the Slough Trading Estate to meet this demand, of which 58,000 sq m has been provided to support our growing data centre customers.
“Developing the highest and best use of industrial land in Slough has been core to our purpose as a business since 1920 and we look forward to continuing to do so following the re-acquisition of the office portfolio, allowing SEGRO to further invest and attract new businesses into the local area.”