Tritax Big Box disposes of 'non-strategic' assets

(Sharecast News) - Real estate investment trust Tritax Big Box said on Wednesday that it has now disposed of half of the roughly £475.0m worth of "non-strategic assets" acquired following its merger with UK Commercial Property REIT in FY24. Tritax Big Box said the assets were sold at a 2.9% premium to December 2023 book value and a blended net initial yield of 6.1%. It also said a further £95.6m worth of assets were under offer, with £68.4m of that in solicitors' hands.

Post completion of the disposals, Tritax stated non-strategic assets will represent less than 4% of total gross asset value, versus 8% at the time of acquisition completion.

Tritax highlighted that the sale marked "substantial progress" in its disposal programme and that it was now looking to "accretively redeploy" capital into higher returning logistics and data centre opportunities. The REIT added that it was confident in its ability to exit the position within 24 months of acquisition, as planned.

Chief executive Colin Godfrey said: "The capital from these disposals, and other ad hoc logistics assets disposals, supports the delivery of our attractive logistics pipeline as well as the exceptional returns through data centre development. In combination with capturing our record rental reversion, these three drivers provide the opportunity to more than double our rental income.

"With an increasingly turbulent geopolitical and economic backdrop, our modern and well-located logistics portfolio is let to strong covenants and carefully crafted to provide investors with an attractive combination of income and capital growth, with the vast majority of our assets used to service the domestic UK market, and having negligible exposure to export-orientated manufacturing."

As of 1050 BST, Tritax shares were up 0.29% at 137.80p.

Reporting by Iain Gilbert at Sharescast.com