The Board of Tritax Big Box REIT plc (ticker: BBOX) is pleased to announce that it has exchanged contracts, conditional on receiving full planning consent, to provide forward funding for the development of a new regional distribution centre at Midlands Logistics Park (“MLP”), Corby. The development asset is pre-let to Eddie Stobart Limited (“Eddie Stobart”), one of the UK’s leading logistics businesses working across the full supply chain in the UK and Europe, a wholly owned subsidiary of ESLL Group Limited, which will act as guarantor. The development represents an investment of £81.8 million.
The site forms part of MLP, a new logistics park to the south of Corby in the East Midlands with direct access to the A43 dual carriageway, which has recently been upgraded and provides significantly improved access to the M1 southbound, M6 and A1(M). MLP is capable of accommodating approximately 2.6 million sq ft. of logistics space with outline planning permission granted. Eddie Stobart is the first tenant to commit to a new facility at MLP, which has a 500-metre rail siding and yard, allowing potential future connection to the rail network. This bi-modal potential capacity of MLP would provide enhanced connections for the site to the UK’s ports and cities. Corby has attracted a number of major occupiers including British Car Auctions, Morrisons, Matalan, Smyths Toys, Staples and Eddie Stobart’s iForce business.
The property will be purpose-built to a high specification, with a gross internal floor area of 844,000 sq ft. and an eaves height of 18 metres, together with extensive parking.
Upon practical completion of the construction, targeted for winter 2018, the property will be leased to Eddie Stobart on a new 20-year lease, subject to five yearly upward only rent reviews indexed to the Retail Price Index, with a cap and collar. The first rent review is due in 2023. From completion of the land purchase and during the construction phase, the Company will receive an income return equivalent to the rent.
Colin Godfrey, Partner of Tritax, commented:
“We are very pleased to be investing in this new regional distribution centre pre-let to Eddie Stobart, an established 3PL operator with long standing customer relationships. This is the first development in a new East Midlands logistics park south of Corby, which is benefiting from recent significant upgrades to the adjacent road network and offers the potential for rail connectivity. The off-market investment further diversifies the Company’s portfolio by geography and tenant, whilst increasing the Company’s WAULT.”