Swingbridge Industrial Estate, Loughborough - Purchased July 2018
A mid-nineties thirteen-unit industrial estate although a number of properties had been sold to owner-occupiers, so the value element comprised four mostly trade counter units including SIG, Euro cell and Howdens. The fourth unit at the time of acquisition was let to a distressed online retailing company although shortly after purchase a lease surrender was negotiated and a new letting concluded at a better rent.
In addition to the routine asset management of the incoming producing units, which has gone well, ownership of the entire estate has allowed for positive management issues to be addressed such as improvement to car parking, landscaping and general presentation issues of the estate signage. Further rationalisation of the development has been possible, with £110,000 gain secured in selling part of the underutilised estate to an adjoining owner-occupier and further a new food outlet being constructed on the front of the estate for regional operator, Birds Bakery. Neither of these latter two initiatives were encompassed within the original appraisal, so they comprise windfall bonus returns
Acquired for just over £3.5m, a lowly geared loan was secured with Lloyds for £1.25m with the balance being investor equity. The business plan revolved around this being an income producing asset with periodic disposals achieved on a unit by unit basis over a three to four-year period. Modelled investor returns were about 9.5% annual IRR over the 4.5-year lifetime of the project.