LondonMetric acquires £78.5m of triple net leases

(Sharecast News) - Real estate investor LondonMetric Property revealed on Thursday that it had acquired £78.5m of triple net leases across five transactions, reflecting a net initial yield of 5.5%, which was expected to increase to 6.3% over five years. LondonMetric said the nine assets added £4.6m of additional rent per annum and had a weighted average unexpired lease term of 23 years.

The assets included a portfolio of five modern Premier Inn hotels from Whitbread, an 80,000 square foot logistics warehouse development funding with Harrison Developments in Malton, a recently developed and reversionary 68,000 sq ft logistics warehouse in the West Midlands, a 21,000 sq ft convenience development funding in Ludlow, and a 40,000 sq ft convenience asset in Tunbridge Wells.

LondonMetric noted that following the hotels acquisition, Whitbread was now its sixth-largest occupier, accounting for 1.5% of total rental income, through its Premier Inn brand.

Chief executive Andrew Jones said: "The Premier Inn transaction presented a great opportunity to acquire mission-critical assets let on very long leases to a FTSE 100 credit with guaranteed rental growth. It adds to our NNN investment in budget hotels, which is benefitting from the ongoing shift in consumer spending towards experience, entertainment and convenience.

"The investments announced today all solidify and improve the granularity of our assets across our winning sectors and we expect to execute on further, similar opportunities in the near term."

Reporting by Iain Gilbert at Sharecast.com