Newcastle's GVA firm directed by M7 Real Estate to market two £7.5m industrial sites

GVA has been instructed by M7 Real Estate to market two industrial investment properties in the North East, with an anticipated combined sale value in excess of £7.5m.

This includes a 121,334 sq ft factory and office complex on a nine-acre site at St. Cuthbert’s Way on the Aycliffe Industrial Estate, the second largest industrial estate in the North East.

The property is fully let on a long-term lease to car parts manufacturer Gestamp Tallent, which recently agreed a restructured 15-year-lease with a commencing rent of £310k per annum and fixed increases five yearly thereafter.

In addition to this, M7 recently undertook a capex programme to further improve the asset, providing a new car park, hard standing areas and new aluminium plant, to facilitate Gestamp Tallent’s contract with Jaguar Land Rover.

GVA has been instructed to seek offers in excess of £5m for its client’s freehold interest in the property, reflecting a net initial yield of seven per cent increasing in June 2024 to 7.55 per cent and in June 2029 to 8.15 per cent.

The rent will be topped up by the vendor to the June 2019 fixed uplift of £373k per annum.

GVA also brings to the market a fully let 67,796 sq ft asset at Northumberland Way on the Stephenson Industrial Estate in Washington.

The property has been let to Spectrum Brands (UK) Ltd on a 20-year fully repairing and insuring lease since 2011, with a low passing rent of £175k and fixed five yearly uplifts.

The property sits on a 3.87 acre (1.57 hectare) prominent road frontage site.

GVA is seeking offers in excess of £2.44m reflecting a net initial yield of 6.75 per cent rising to 7.7 per cent in February 2021 and 8.67 per cent after February 2026.

Simon Beanland, at GVA, commented: “We anticipate strong interest in both these very well located and fully let industrial investments.

“We continue to see strong investor demand for well-let industrial opportunities in the North East, driven mainly by a thriving occupational market, a limited supply of investment stock and an attractive yield discount relative to our regional neighbours.”