The 33,715 sq ft unit at Beech Business Park, Bristol Road, in Bridgwater was developed and sold by KMW Properties Ltd, represented by LSH, to Alder King clients Metric Income Plus Ltd Partnership (MIPP).
The £3.7 million unit is let to CDS (Superstores International) Ltd, trading as The Range, for 20 years from 1 February 2013 at an initial rent of £264,000 per annum, reflecting a net initial yield of 6.8%.
Hollie Ruddle, senior surveyor in the capital markets team at LSH in Bristol, said: “Working alongside our clients KMW Properties, we were able to demonstrate our experience and expertise by turning what was a vacant warehouse into a sought-after retail warehouse on a long lease with a very strong covenant.
“We acquired the vacant building on behalf of KMW Properties and, with support from our retail team, were able to get planning permissions changed to retail use. The original building was demolished to make way for a new, high specification retail warehouse with a prominent frontage on the busy Bristol Road.
“Retail agency director John Butt, an expert in retail warehousing, secured the letting to The Range and worked with developer and the tenant to ensure that the new unit met all their requirements. We were then able to complete the sale of the freehold to Metric Income Plus Ltd Partnership, representing an excellent outcome for our clients.”
Paul Edwards, director of KMW Properties, said: “This unit is in a prominent location and, with the support of our agents Lambert Smith Hampton, we were able to secure a very good tenant which made it an even more attractive investment opportunity resulting in the sale of the freehold to MIPP.”
Oli Stretton, associate in Alder King’s investment team, said: “Our recommendation for purchase was based on a compelling rationale. The property benefits from excellent frontage to the A38 in Bridgwater which itself is likely to benefit from significant growth as a result of the proposed Hinkley Point C development. The unit is let on a long lease to a strong covenant off a low base rent with built-in rental growth providing an attractive running yield.”