LondonMetric has exchanged contracts to buy two assets from Columbia Threadneedle Investments’ Trilogy portfolio for £50m, Green Street News can reveal.

The REIT has agreed to acquired the 450,000 sq ft UPS Logistics Centre at East Midlands Airport Gateway as well as the 365-bedroom Clayton Hotel Manchester Airport. The investments are effectively ground rent-style acquisitions, with average unexpired lease lengths of over 100 years and let on highly reversionary rents. Combined annual income sits at £8m, reflecting a running yield of around 5%.

UPS developed the purpose-built logistics facility itself, completing it in 2021. Located at the airport, the distribution centre has the capacity to sort 22,500 packages per hour and is the largest air logistics facility the company occupies outside of the US. It is let on a rent of £3/sq ft for another 92 years.

The Clayton Hotel was built in 1995 and renovated in 2017 and is located next to Manchester airport’s Terminal 1. Clayton is a brand owned by Dalata Hotel Group, for which Pandox and Eiendomsspar completed their €1.7bn take-private earlier this month. The hotel has another 199 years remaining on its lease.

Threadneedle had previously pursued a sale of the duo as part of a wholesale £650m disposal of 55 assets around Manchester, Stansted and East Midlands airports known as Trilogy. The seller decided to pull a deal with KKR and Mirastar over the summer after it decided it could get better pricing on a piecemeal basis, having also had deals come close with JD.com and TPG without completing.

Knight Frank is now leading the sale of £150m-£200m of hotels from the collection, while Newmark is marketing warehouse opportunities from the collection, including BOX.STN, a site that has planning consent for 2.1m sq ft of logistics development at Stansted.

Threadneedle bought the portfolio in the midst of the pandemic in 2020 for around £340m, on behalf of a mandate from Citibank.

Kimmre is advising LondonMetric, while Knight Frank is representing Columbia Threadneedle.

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https://greenstreetnews.com/article/threadneedle-strikes-sale-of-50m-duo-from-trilogy-portfolio/