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Dalata to shed UK hotel for £22M; Panther Securities to sell commercial site


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Dalata to shed UK hotel for £22M; Panther Securities to sell commercial site

This feature rounds up recent property news from S&P Global Market Intelligence's covered companies and highlights larger deal coverage already published.


* Dalata Hotel Group Plc and M&G Real Estate agreed to a sale and leaseback of the former's 216-room Clayton Hotel-Cardiff in Wales, for a cash sum of £22.1 million. The agreement involves a 35-year fully repairing and insuring lease, with an initial annual rent of £1.15 million, subject to five yearly rent reviews and index-linked to the Retail Price Index. The property generated EBITDAR of £2.3 million in 2016.

The deal is expected to close mid-June, with proceeds earmarked for the reduction of net debt accrued from recent acquisitions.

* Panther Securities Plc exchanged contracts with an undisclosed buyer to sell a site in Holloway Head, Birmingham, for £11.0 million, with completion expected in six months. The sale will generate a "good" profit over the land's book value of £6.0 million as at 2016-end. In November 2015, the site landed planning permission for 487 residential units and roughly 5,000 square feet of commercial space. The permission covers two long-leasehold and three freehold properties acquired by Panther over the last 30 years, as well as the Girl Guides area headquarters.

The buyer will have to negotiate extensions for the site's two 100-year leaseholds, Panther said in a release.

* LXI REIT plc acquired a 248,333-square-foot manufacturing facility in Carlisle, Cumbria, for £9.3 million in a sale-and-leaseback deal with the SIG plc group. The price reflects a net initial yield of 7%. The site is fully leased to SIG's trading company, and the acquisition comes with a new 25-year lease with no tenant break option and expiring in May 2042. The lease is subject to five yearly upward-only rent reviews index-linked to the Retail Price Index, or RPI.

LXI is using equity resources to fund the acquisition, with debt financing expected to be introduced "in the near term." The acquisition enables the company to qualify formally as a real estate investment trust, after achieving a sufficient number of built assets, as well as forward fundings and forward commitments, according to a release.

* Meanwhile, in Leeds, LXI exchanged contracts for the acquisition of the three-story, 75-room Priory Care Home property for £8.4 million, reflecting a net initial yield of 6.3%. The company is funding the acquisition with equity resources and senior debt financing, and completion is expected over the next week.

The property is 100% leased to Priory Elderly Care Ltd. with a term expiring March 2040, without a break. The lease is subject to annual upward-only rent reviews index-linked to the RPI.

* Highcroft Investments Plc, through its subsidiary Rodenhurst Estates Ltd., paid £4.2 million to acquire the freehold interest of an industrial asset near St Austell, in Cornwall, from St Ives Plc. The property consists of two industrial units spanning a total of roughly 250,000 square feet and a vacant site with a single lease expiring April 2021.

The acquisition price represents a net yield of 11.23% and the company has obtained a £4.5 million 10-year fixed-term, non-amortizing, secured loan to fund the deal.


* UBM Development AG unit Münchner Grund Immobilien Bauträger GmbH purchased the Potsdamer Hauptpost property and an adjacent vacant plot for a new development in Potsdam, with construction scheduled to commence in the second quarter of 2018. The planned 11,450-square-meter commercial asset was acquired in a joint venture with a family office of Nicolas Berggruen Holdings GmbH. The property's tenants include Deutsche Post and Deutsche Postbank.

Additional coverage

Dublin private rented sector portfolio on sale for €425M: Marlet Property Group and finance partner M&G Investments have signed up Savills for the sale of the Dublin Living portfolio on a forward-funding basis, Property Week reported.

Allianz Real Estate purchases Berlin office complex for €175M: The 40,000-square-meter property is in the Charlottenburg area of Berlin, Europe Real Estate reported.

Swedish-Finnish JV adds €160M Finnish portfolio: The 10-asset portfolio spans more than 100,000 square meters.

Royal Mail sheds 2 Nine Elms plots in London for £101M: The postal services company will use £30 million of the sale proceeds to invest in its five remaining Nine Elms plots in a bid to push up "future sales values," City A.M. reported.