Tritax Big Box REIT plc (LON:BBOX) has announced that it has successfully exchanged contracts for the sale of an investment asset let to Howdens in Raunds for a net consideration of £84.3 million, in line with its December 2022 and June 2023 valuations, and reflecting a net initial yield of 4.0%. The purchaser is a leading UK institutional investor in real estate.
The investment asset is one of three buildings at Raunds developed for and let to Howdens Joinery Group Plc. It comprised a 659,000 sq ft logistics building, which the Company has owned for seven years, with an unexpired lease term at exchange of approximately 23 years. The investment disposal reduces the geographical and occupier concentration whilst delivering an attractive return over the hold period. Howdens continues to occupy the remaining two buildings, which are owned by Tritax Big Box.
The transaction brings the total value of disposals exchanged or completed so far in 2023 to approximately £235 million.
Colin Godfrey, CEO for Tritax Big Box, commented:
“We constantly seek ways to optimise our portfolio to crystalise value and recycle capital into higher returning opportunities. The disposal, which was in line with the book value at both December 2022 and June 2023, demonstrates the attractiveness of our assets and our ability to fully realise their value. The sale to a leading institutional investor in real estate provides further evidence of growing stabilisation within the UK investment market and the strong fundamentals of the sector.”
Tritax Big Box has also declared an interim dividend in respect of the period from 1 April 2023 to 30 June 2023 of 1.75 pence per ordinary share, payable on or around 31 August 2023 to shareholders on the register on 11 August 2023. The ex-dividend date will be 10 August 2023.
In accordance with the Company’s dividend policy, the first, second and third quarter dividend payments will each represent 25% of the previous financial year’s annual dividend of 7.00 pence per ordinary share. The level of the fourth quarter dividend will be used to determine any potential dividend progression, with an overall aim to achieve a pay-out ratio in excess of 90% of Adjusted earnings.
This dividend will be a Property Income Distribution (“PID“).
