Life science investment fund acquires "premium" London site for £77m

Life Science REIT, the real estate investment trust focused on UK life science properties, announced it completed the acquisition of Rolling Stock Yard.

The site is a “premium, nine-storey office and laboratory building” near London’s St Pancras station from a joint venture of Newmark Properties, Argo Real Estate, and Investec Bank.

The purchase price of £77m, excluding acquisition costs, was satisfied entirely in cash and reflects an attractive net initial yield of 4.4 per cent.

This acquisition was under exclusivity at the time of the Company’s IPO last month and marks the first major transaction to be completed by the Company.

The building was completed in March 2020 and meets the Company’s sustainability objectives with a BREEAM Excellent rating and an EPC rating of A.

Occupancy of the property, which has attracted life science companies including Gyroscope Therapeutics, is at 76 per cent, with the Company benefiting from an 18 month rental guarantee on the remainder.

The property currently generates £3,478,000 of contracted rent per annum including guarantees. The property has a weighted average unexpired lease term of seven years.

Simon Farnsworth, managing director of Ironstone Asset Management Ltd, the Company’s Investment Adviser, said: “We are delighted to announce Life Science REIT’s first major acquisition since our IPO last month.

“Rolling Stock Yard offers attractive current income but importantly also includes significant asset management opportunities including the creation of further laboratory space to drive additional rental income growth.”