A private South Korean investor is on the verge of acquiring a Sainsbury’s-let shed in the Midlands in a deal worth around £100m.
IM Properties has struck an off-market deal with the South Korean investor to sell the 700,000 sq ft distribution centre in Hams Hall, near Birmingham.
The deal, which is likely to complete in a matter of weeks, would mark the second time in a year that South Korean investors have acquired a distribution centre in the UK and is further evidence of Asian interest in the UK industrial and logistics sector.
Last April, Mountpark sold its 1m sq ft Amazon-let facility in Bardon, Leicestershire, to a consortium of South Korean investors for £126m.
“The Asian buyers are all over the UK and European sheds market at the moment - it’s not just central London offices they are looking at,” one source told Property Week.
“The investment fundamentals of the sector are so strong that there is a queue of investors looking to get into it and I think we’ll see a lot more off-market deals like this take place over the course of the year.”
It is not the first time IM Properties has taken advantage of Asian investor appetite for the sector. Last year, it sold a £200m portfolio of industrial assets to the Malaysian state pension scheme, Employees Provident Fund (EPF).
The portfolio was made up of 18 assets stretching from Heathrow to Birmingham and totalled 2m sq ft.
IM Properties said at the time it would put the proceeds into its development pipeline and acquire income-generating assets.
The Sainsbury’s distribution centre was built in 2002 and was owned by the grocery giant until 2008, when it sold a tranche of warehouses for £191m in sale-and-leaseback deals.
IM Properties bought the property for £70.1m for its Christian Vision fund, with Sainsbury’s signing a 25-year lease.
The scheme, which is fully automated, has ambient, chilled, produce and specialist banana storage facilities as well as 156 loading docks, and 35,000 sq ft of office and welfare facilities.
Knight Frank advised the South Korean buyer. All parties declined to comment.
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