Schroders Capital UK Real Estate Fund expands industrial presence and completes 275,000 sq ft of lettings

Hartlebury Trading Estate

Schroders Capital UK Real Estate Fund (SCREF) has completed 275,000 sq ft of new industrial and logistics letting transactions across its UK-wide portfolio as a result of which the portfolio has now reached an occupancy level of 98%.

The lettings include two 10-year leases at Acorn Industrial Park in Crayford to Thamesway Transport Services and Top Stone Station Limited for 16,546 sq ft and 14,318 sq ft units respectively.

These lettings coincide with the practical completion of several new units at Hartlebury Trading Estate in the West Midlands, which includes the new five-unit Crossways scheme. SCREF’s team has agreed to lease these units to Comcourt Ltd and Redspeed International on 10-year leases, and Firma Stella on a 5-year lease. Meanwhile, the new Hartlebury 30 unit has been pre-let to ETAC on a 15-year lease.

The new units at Hartlebury Trading Estate have been built to high sustainability standards with Crossways featuring solar panels and electric vehicle charging points. The new developments have also received BREEAM ‘Very Good’ certification and have an EPC ‘A’ rating. They have also increased SCREF’s industrial weighting to 33.62%.

Alongside the lettings at Crayford and Hartlebury, SCREF’s team agreed a 15-year lease with MBH Group Ltd at Oakwood Business Park in Park Royal, London. The Fund originally acquired the asset during the £345m industrial swap deal completed with SEGRO last October, which saw SCREF acquire six multi-let industrial and logistics assets located across the UK, worth a collective £205m.

These lettings follow on from the 58,320 sq ft pre-let SCREF completed in March with international logistics company DPD at its Revolution Park asset in Wolverhampton for a 25-year term. The deal was recently awarded “Deal of the Year 50,000 to 100,000 sq ft” at the Industrial Agents Society Awards, and the team will target best-in-class sustainability credentials including a BREEAM Excellent rating for the Revolution Park asset, which will be built to a net zero carbon specification.

With these significant lets and pre-lettings, the Fund has demonstrably benefitted from Schroders Capital team’s hospitality approach to asset management, developing close relationships with occupiers to understand changing requirements and optimising lease terms. Through this approach the team identified development and refurbishment opportunities in the existing SCREF portfolio to increase its industrial weighting and securing long term sustainable income for SCREF

Rob Cosslett, Acting Fund Manager of Schroders Capital UK Real Estate Fund, said: “Our team’s active approach to asset management and ability to develop close relationships with occupiers have allowed The Fund to deliver successful industrial schemes which are attractive to tenants and offer long term growth prospects.

“The Fund will continue to selectively identify industrial development opportunities across the portfolio in order to unlock latent prospects for income growth for the Fund and its investors.”