19 July 2016
DRIP REIT Announces Prime Office Acquisition
DRIP REIT portfolio growth continues with eight major UK investment properties totalling £45.7 million
Drum Income Plus Real Estate Investment Trust (DRIP REIT) has completed another significant acquisition with the purchase of 3 Lochside Way at Edinburgh Park for £4.5 million.
3 Lochside Way is a 24,000 sq ft Grade A office prominently situated on Central Scotland’s premier business park with Lockheed Martin, Exception and GL Industrial Services as key tenants. The purchase price reflects a yield of 8.5%.
Located just two miles from Edinburgh airport, Edinburgh Park is directly connected to Edinburgh City bypass and the motorway network, in addition to being serviced by two train stations and three halts on the new tram line, providing direct access to the city centre and airport.
DRIP REIT has now completed acquisitions valued at £45.7 million, with a further committed transaction for £2.6 million currently subject to shareholder approval, since it raised £31.8 million at the time of its IPO in May 2015. An additional £2.8 million was raised as an Initial Placing following the publication of a new prospectus in February 2016. The subsequent 12-month placing programme closes in March 2017.
Welcoming the acquisition of 3 Lochside Way, DRIP REIT’s Chairman, John Evans said:
“The acquisition of Lochside demonstrates DRIP REIT is continuing to identify property that delivers on our differentiated investment strategy of assets of between £2m and £15m in strong regional locations with opportunities to increase value.
"Our experienced team is focused on the delivery of an asset management strategy that will drive rental growth and maximise additional income opportunities, offering investors an attractive blend of income return and capital growth."
DRIP REIT is an income focused real estate fund targeting regional commercial property assets, principally in the office, retail and industrial sectors where there is an opportunity to increase income and capital returns via entrepreneurial proactive asset management and risk-controlled development.
Regarding future expansion, Drum Real Estate Investment Management’s (DREIM) Managing Director, Bryan Sherriff commented:
“Adding Lochside to the portfolio fits with our stated strategy of acquiring regional multi-let assets that offer asset management opportunities. We are delighted with the acquisition, which is on the back of increased values at June quarter. DREIM believe that the sub-£15m regional assets still represent fair value and with the larger Funds trying to increase lot size we believe there may be further buying opportunities.”
The Board of DRIP REIT comprises John Evans (Chairman), formerly of Aberforth Partners, Hugh Little (Chair of Audit Committee) formerly of Aberdeen Asset Management and Alan Robertson (Director) of Jones Lang Lasalle. Drum Real Estate Investment Management Limited is the Investment Manager of DRIP REIT.