· Exchanged on the acquisition of Peterhouse Technology Park, Cambridge and The Priestley Centre, Guildford, increasing our exposure to innovation sectors
· Acquisition of the Finsbury Square Car Park and the Thurrock Shopping Park, creating development opportunities for urban logistics
· Sale of Virgin Active Chiswick and part sale of Woodfields Retail Park, Bury and under offer on the sale of Wardrobe Court, EC4
Our strategy is to more actively focus our capital on two strategic themes, Campuses and Retail & Fulfilment.
Our recent acquisitions align to our strategic themes and demonstrate further significant progress against our priorities. Proceeds from our disposals are being recycled into acquisitions and value accretive development including more than 1m sq ft of new development commitments since November 2020, as well as our 53 acre development project in Canada Water where we have recently opened our marketing suite.
Simon Carter, CEO, British Land said: “We are delighted with the momentum we are delivering across our business as the economy reopens. Leasing activity at our London campuses has been strong, with a significant amount of space going under offer to a broad range of occupiers in the last two months.
At the same time, we are continuing to deliver against our strategic priorities. We have sold off-strategy mature assets and will actively redeploy capital into opportunities that allow us to maximise our competitive advantage in asset management and development.”
Campuses
In line with our strategy to target innovation sectors, we have exchanged on the acquisition of The Peterhouse Technology Park in Cambridge for £75m, representing a net initial yield of 4.15%. This 8.25 acre site, just outside the centre of Cambridge comprises four buildings covering 140,000 sq ft, and is fully let to technology business Arm for its global headquarters at a passing rent of £26 psf. The buildings are held on a long leasehold with significant reversionary potential and benefit from their location in an emerging part of south Cambridge, close to the Cambridge Biomedical Campus.
We have also exchanged on the acquisition of The Priestley Centre in Guildford, located on the Surrey Research Park for £12m. The 7.8 acre site provides an attractive opportunity to deploy our campus proposition and development skills to deliver high quality space for the fast growing industries in this affluent town, which includes satellite technology, life sciences, video game development and digital technologies.
Retail & Fulfilment
Aligned to our strategy to progress development-led urban logistics opportunities in Central London, we have acquired the Finsbury Square Car Park for £20m. This underground car park is close to the Broadgate campus and provides an excellent opportunity to create a last mile logistics hub in the City of London where supply for last mile logistics is highly constrained.
As announced in our operational update on 13 July, we recently acquired the Thurrock Shopping Park for £82m. This presents a clear urban logistics development opportunity, given its prime location just off the M25 and proximity to east London. In its current use, it has a strong occupier line up including Decathlon, Adidas, Nike, TK Maxx, Iceland Food Warehouse and Pets at Home. It also benefits from an excellent catchment where significant population growth is expected.
Capital recycling
In line with our strategy to crystalise value from more mature and off-strategy assets, in the quarter, we have sold or are under offer on c.£160m of assets, overall 6.0% ahead of book value. This includes the recent sale of Virgin Active in Chiswick for £54.3m in line with book value and the part sale of the Woodfields Retail Park in Bury for £37.5m, 18% ahead of book value. We are also under offer on the sale of Wardrobe Court, a standalone residential building in the City of London.
We are pleased that Fitch recently affirmed all our credit ratings, including our Senior Unsecured rating at 'A', with a Stable Outlook.