The Company is also pleased to announce that it has completed the acquisition of the previously announced new freehold distribution warehouse in France, for a net value of €44.5 million.
This newly built climate controlled facility in Noves, near Avignon, with an approximate area of 28,570 square metres sits in the south of the French corridor in the Provence region at the crossroads of the A7 and A9 motorways and is 7km from Avignon airport. The region is highly ranked in France for the production of fresh flowers, fruit and vegetables. The warehouse is very well positioned for food distribution with Carrefour, Aldi and Système U already operating distribution centres in the area.
This income producing asset has been fully let to Biocoop, a French supermarket operator, with a 12 year lease and annual indexation. It consists of four cells with a total area of approximately 28,570 square metres, with 33% of the floor space given over to cold storage. Biocoop, founded in 1986, is a leader in organic food distribution and known for its fair trade products and wide choice of ecoproducts and cosmetics.
Avignon is a strategic location for Biocoop which operates a unique multi-professional cooperative model. As at the end of August 2018 its network operated over 550 organic stores promoting local production to limit transport and support local economies. The property, developed by Barjane and which provides the versatility required to move to a multi-tenant scenario if ever required, has been labelled “HQE Excellent” with a high specification agreed with Biocoop which itself looks to limit environmental impact.
The tenant has signed a fully indexed 12 year lease of which 9 are firm. Net initial yield is expected to be in the region of 5.0% reflecting agreed passing rent which will be subject to annual indexation. Covenant strength is very strong. Additional secured cash flow will be generated from solar panels placed on the roof with an option of a photovoltaic plant alongside the property.