Orchard Street Investment Management LLP, the specialist commercial property investment manager, has acquired Hereford Retail Park, Hereford from PRUPIM for £12.35 million, reflecting a net initial yield of 6.5%. The purchase was made on behalf of St James’s Place property funds.
Hereford Retail Park provides 53,389 sq ft of modern retail space and is currently let to a high quality line up of tenants including DFS, PC World & Currys Megastore, Harveys and Carpetright, all at rents between £15.50 and £16.00. The entrance to the park includes a standalone A3 retail unit currently let to Pizza Hut at a rent of £19.50. All leases are coterminous with 13 years to run without break. The park also has a bulky goods planning consent that allows for the sale of pets and pet products.
The retail park is excellently located on the strategically important Newton Road in Hereford and stands to benefit from increased footfall when the "The Old Market" shopping centre development completes in 2014.
Commenting on the acquisition, Barney Rowe, Partner at Orchard Street, said:
"We are pleased to have acquired Hereford Retail Park, the prime retail warehouse in this attractive cathedral city. As an investment, the park offers long and secure income from tenants with strong covenants on a low rent, while Hereford provides a loyal catchment area of consumers with minimal competition from surrounding towns. With the arrival of the new shopping centre, both the city and Hereford Retail Park stand to benefit, with the retail park more than most given its position and proximity to the new scheme"
Cushman and Wakefield advised PRUPIM and Morgan Williams advised Orchard Street.
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Orchard Street Investment Management
Established in 2004, Orchard Street Investment Management LLP is a leading specialist commercial property investment manager, focused on the UK market. It acts on behalf of institutional clients world-wide to advise on investing in and the active management of property assets, including industrial, retail warehouses, offices and shopping centres. Orchard Street currently has assets under management exceeding £4 billion.