LondonMetric buys portfolio through new joint venture

19th Dec 2013 09:40

LondonMetric Property has agreed to pay 175m pounds for a portfolio of 27 properties from administrators to the owner of furniture retailer DFS, Delphi Properties.The purchase price reflects a net yield of 9.3% and the acquisition is expected to be completed on March 25th next year. The portfolio will be bough through new joint venture which LondonMetric is forming with LVS II Lux X, called LMP Retail Warehouse JV Property Unit Trust.LondonMetric will own 30.5% of the joint venture. The portfolio includes 22 DFS furniture retail warehouses, four industrial units and DFS' headquarters and distribution centre, covering a total area of 903,700 sq ft. The rent roll is £17.3m per annum and all the leases expire in March 2030. LondonMetric will be responsible for the management of the portfolio and will receive a fee equivalent to 4% of rents received. The acquisition will be financed with a new debt facility which has been put in place for completion. Andrew Jones, Chief Executive of LondonMetric, said: "Our new joint venture with LVS allows us to access both new equity and debt funding whilst leveraging our asset management platform and strong occupier relationships. We aim to grow the attractive day one cash on cash returns as we execute asset management initiatives."Shares rose 0.92% to 131.60p at 10:05 on Thursday.RD