TV studios deal
STV studios sold as part of £80m property deal
STV studios are part of the deal
A property investment trust has acquired STV’s media studios and HQ in Glasgow, a recycling centre in Aberdeen and the life science and biotech campus in York in a deal worth £80 million.
LXi REIT, a specialist inflation-protected long income REIT, said the deal reflects an accretive 5.25% average net initial yield, compared to a current portfolio value of 4.7%, and follows the company’s £100 million placing last month.
The acquisition of STV’s facilities at Pacific Quay is through an off-market transaction. The facility, which was purpose-built for STV, comprises 63,000 sq ft over four floors, along with 150 car parking spaces.
It benefits from a new, unbroken 20-year lease to STV and the current rent is £16.25 per sq ft compared to Grade A office rent in Glasgow currently in the order of £35 psf. The rent, during the lease term, increases five yearly at a fixed rate of 1.5% pa.
LXi has acquired a waste recycling and storage facility two miles south of Aberdeen at East Tullos which is let to Biffa on a long lease with 14 years unexpired to first break. The rent increases on an annual basis in line with CPI inflation, with a collar of 2% pa and a cap of 4% pa.
The facility is Biffa’s only waste transfer site in Aberdeen and the company has commenced discussions with the tenant to increase the length of the lease.
The other assets in the deal is a substantial Life Science and Biotech campus in York employing 1,000 people in 382,000 sq ft of highly specialist facilities across 82 acres.
The campus is fully let to Capita on a long lease with 25 years unexpired until first break.
Simon Lee, Partner, LXI REIT advisers commented: “These transactions demonstrate the company’s continuing ability to make accretive and secure long income investments across a wide range of structurally supported sub-sectors, including its first investment in the life science arena, as well as highly profitable disposals.”