Bradda Capital, the UK real estate investment adviser, has completed £30 million of transactions for its two evergreen real estate funds.
Bradda has acquired four industrial and office properties in Warrington, Glasgow, Gateshead and Birmingham for £16.7 million for its second fund, which was launched a year ago with seed funding of £30 million from investors in its first fund and is targeting a capital raise of £150 million. It has also sold six assets for more than £16 million from its first fund launched in 1998, reaching a net asset value of more than £200 million. Investors in the two funds are principally family offices.
David Phillips, Managing Director of Bradda Capital, said: “The four properties we have acquired are high-quality, low depreciating investments with very secure income and better-than-average rental growth prospects, which we secured at net initial yields of more than 6%.
“The five assets we sold achieved very good prices, mainly reflecting yields of less than 5.7%. That reflected significant pent-up occupier and investor demand for logistics assets linked to e-commerce, as well as very strong investor demand for relatively high-income yielding assets of a size that appealed to smaller institutions and private investors.
“We believe our sector-agnostic, absolute returns approach affords us the flexibility to move from one sub-sector to another as pricing and risk-adjusted returns dictate. Sticking to the basics of high-quality properties in large conurbations with sustainable rents from tenants who are committed to their locations, serving a real purpose in today and tomorrow’s economy has certainly proven to be a good long-term investment strategy over the last 23 years”.
The four properties just acquired for the second fund, which generate a blended net initial yield of 6.3% and have a combined weighted average unexpired lease term of more than 11 years, are:
Warrington: 520 Europa, a 44,750 sq ft warehouse at Gemini Business Park, let to DX Network Services, for £3.65 million, reflecting a net initial yield of 6.6% net; Bradda was advised by JLL and the vendor was advised by Avison Young
Glasgow: a new 28,017 sq ft warehouse at Clyde Gateway East Business Park, let to Torishima, for £3.2 million, reflecting a net initial yield of 6.04%; Bradda was advised by Ryden and the vendor, Clyde Gateway Developments, was advised by Avison Young
Gateshead: a newly refurbished 51,800 sq ft warehouse at Princes Park, Team Valley, let to Thermodynamix, for £3.7 million, reflecting a net initial yield of 4.8% rising to 6.5% in April 2021 after a fixed increase in the rent; Bradda was advised by The Estate Office and the vendor by Naylors Gavin Black
Birmingham: Three Devon Way, a new 21,624 sq ft office building at Longbridge Technology Park, let to Barnett Waddingham, for £6.18 million, reflecting a net initial yield of 6.25%; Bradda was advised by JLL and the developer, St Modwen, was advised by Savills
The five assets that were sold from the first fund are:
Edinburgh: a 30,050 sq ft warehouse at South Gyle, let to UPS, for £4.1 million, reflecting a net initial yield of 4.8%; Bradda was advised by Ryden and the buyer was advised by JLL
Haywards Heath: Chalegrove House, a 10,841 sq ft office building, let to PNC Financial Services, for £4.025 million, reflecting a net initial yield of 5.7%; Bradda was advised by JLL and the buyer was advised by Allsop
Leamington: a 22,000 sq ft light industrial unit at Sydenham Industrial Estate, let to Elizabeth The Chef, for £1.85 million, reflecting a net initial yield of 5.6%; Bradda was advised by Wareing and Co
Tonbridge: Fosse House, a 10,000 sq ft office building, let to Charity Bank and First Actuarial, for £2.55 million, reflecting a net initial yield of 7.2%; Bradda was advised by JLL and the buyer was advised by Allsop
Tonbridge: land of just more than one acre with existing planning consent for nine town houses and three apartments sold to Churchill Retirement Living, subject to planning consent for retirement living apartments
FOR FURTHER INFORMATION:
David Phillips 01444 472530
Tavistock (PR adviser)
James Whitmore 0207 920 3150
NOTES TO EDITORS:
Founded in 2018, Bradda Capital, and its predecessor, Commercial Management Ltd, have sourced and assisted with structured investment and financing of UK commercial real estate on behalf of the same investors for more than 30 years. They have created several institutional-size portfolios of London and regional offices, shopping centres, warehouses and elderly care, the latter consisting of the Retirement Villages Group, which was sold to AXA IM - Real Assets in 2017.