NewRiver REIT on Monday said it has completed the £40.0 million acquisition of Sprucefield Retail Park in Lisburn, Northern Ireland.
On Monday last week, NewRiver announced it had exchanged contracts for the deal with Intu Properties.
The £40.0 million represents an 8.7% net initial yield on the property, which is expected to generate another £3.7 million of annualised net property income for NewRiver. The deal will be funded using the firm's existing resources as well as its available credit facilities.
The acquisition expected to be "highly accretive" to the real estate investment trust's underlying funds from operations, as well as significantly improving its dividend cover, a "key priority".
NewRiver REIT PLC said today it has acquired community pub firm Bravo Inns Ltd for £17.9 million.
Bravo Inns owns 44 wet-led community pubs - meaning the pub focuses on drinks rather than food - which are mainly situated in north west England.
The acquisition is expected to generate £2.6 million in annualised outlet earnings before interest, taxes, depreciation and amortisation, equal to a yield on cost of 14%, and is also anticipated to be accretive to underlying funds from operations.
The deal will also complement NewRiver subsidiary Hawthorn Leisure's 660 community pub portfolio, and increase the real estate investment trust's exposure to the operator managed pub model.
"The UK pub sector has experienced a recent revival in transaction activity and, as an early investor into community pubs, we have been tracking the success of Bravo Inns for some time. The transaction will increase our portfolio weighting in community pubs and demonstrates the value of our Hawthorn Leisure platform in identifying acquisitions that can deliver higher yielding sustainable cashflows with scale driven synergies," said Chief Financial Officer Mark Davies.
In its own announcement, intu properties has exchanged contracts for the sale of Sprucefield Retail Park to NewRiver REIT Plc for £40 million, in line with the June 2019 valuation.
Sprucefield Retail Park is located in Lisburn, Northern Ireland and comprises of 231,000 sq ft of retail space in five units, anchored by Sainsburys and B&Q.
Matthew Roberts, chief executive of intu, commented: “We announced our new strategy at the interim results in July. A key element of this is fixing the balance sheet which includes creating liquidity through disposals. We are pleased to conclude this transaction, which along with the part-disposal of intu Derby and other sundry asset sales in 2019 brings the year to date disposals total to £268 million.
