Segro buys Canning Town warehouse in £133m deal
Property development firm Segro is adding a Canning Town warehouse estate to its London portfolio as it increases its presence in the capital.
The landlord, which counts Amazon and Ocado as some of its clients, today announced it had acquired Electra Park, a 13 acre urban warehouse, from global investment manager Schroders for £133m.
The site provides 21,2000 square metres of lettable space across 10 units of which nine are currently let. The firm said there is rental income of £3.4m per year.
It came as Segro announced a strong start to the third quarter as demand for warehouses from online retailers peaked during the pandemic.
Segro said it had signed contracts worth £15.8m in the third quarter. Rental collection also remains stable into the fourth quarter, currently at 85 per cent of total rent billed, higher than the previous two quarters.
Chief executive David Sleath said: “SEGRO has continued to perform well in the third quarter with the acceleration of structural trends fuelling further demand for our asset class from both customers and investors, outweighing any negative economic impacts from the pandemic.”
Electra Park is in a prime spot, close to Canary Wharf and London City Airport, and is undergoing significant redevelopment.
Alan Holland, business unit director for Segro’s Greater London portfolio, said the acquisition is “an exciting opportunity for Segro to consolidate its leading London footprint”.
The redevelopment “should improve the already attractive supply/demand dynamics and create the potential for strong rental growth, as we have seen happen in other London markets.”
The new acquisition adds to Segro’s expanding London portfolio after it bought Perivale Park, in West London, from Federated Hermes for £202.5m in June.
The site provides 55,100 square metres of lettable space across 23 units and eight acres of land currently leased as a vehicle compound.