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SEGRO completes acquisition of 50% stake in Airport Property Partnership

23-Jun-2010 9:30 AM

UK's SEGRO plc announced (22-Jun-2010) it has completed the acquisition of BAA's 50% interest in the Airport Property Partnership (APP), the JV with Aviva Investors. SEGRO also announced it has agreed with APP and Aviva Investors to sell assets from SEGRO's existing portfolio into APP for a cash consideration of GBP237 million. These assets will enlarge the APP portfolio from GBP447 million to GBP684 million. The price of the assets being sold to APP represents a net initial yield of 5.1% and a net equivalent yield of 7.2%: the weighted average remaining lease length is approximately 3.8 years (to break or expire) and the vacancy rate on the assets being sold is 16.5%. APP will fund the acquisition through drawing on its committed debt facilities and by approximately GBP70 million of new equity from each partner. The transaction is expected to complete before the end of Jun-2010. [more]