Two major investment deals have just been concluded in the west of Scotland, one in a Glasgow building and the other at the former Linwood car plant site.
Now under massive redevelopment by Tilbury Phoenix, the Linwood site is home to dozens of industrial, office, and retail space occupiers. In a #10.59m deal, Tilbury Phoenix has sold a 7418 sq m (187,495 sq ft) high bay warehouse to Friends Provident Property Services.
The warehouse is pre-let to Express Cargo Forwarding Ltd at a rent of #843,730 per annum (#4.50 per sq ft). The deal is based on a 25-year lease with five yearly rent reviews. The acquisition by FPPS represents a yield of 7.65%.
Commenting on the decision to buy the warehouse Ian McBryde, fund manager at FPPS, said: ''The Phoenix is one of Scotland's most prestigious business and distribution locations and presents a sound investment opportunity. This most recent acquisition complements our strategy to increase our exposure to the industrial and distribution sector.''
Charlie Springall, managing director at DTZ Debenham Thorpe in Scotland, agents for Tilbury Phoenix, said: ''With fantastic prospects for future growth at an extremely promising yield, the deal with Friends Provident represents a crucial investment in The Phoenix and underlines the great confidence being shown in prime Scottish investment opportunities. In the eighties The Phoenix was a redundant site, but today it is one of Glasgow's most important destinations for leisure, retail, business, industrial and auto operators.''
Construction of the Express Cargo building is being carried out by Tilbury Douglas Construction at a cost of #6.5m and is due for completion in October.
Meanwhile, back in the city centre the former Scottsh Amicable HQ at 150 St Vincent Street has changed hands in a #5.1m deal. SFG Properties Ltd has purchased the 6205 sq m (66,800 sq ft) property from Scottish Amicable Life Assurance Society.
With a basement, ground, and six upper floors, the building produces an annual rental of #438,594. The purchase price represents a net initial yield of around 8%.
Tenants include Registers of Scotland and Targeting Technology Ltd. With two vacant floors, there is potential for more income and long term development.
Douglas Wilson of Jones Lang Wootton, who represented SFG Properties, says that the building's short term leases offer a good strategy in the market.
''Glasgow's office market has been among the last in the UK to recover from the recession. There are several empty new buildings in the city centre, all asking for 15 year leases and rents of #20 or more. Short term, flexible leases at 150 St Vincent Street offer SFG a good income until the market fully recovers.''
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