UK listed REIT NewRiver Retail has acquired a portfolio of 158 pubs across England and Wales, at a net initial yield of 13.61%.
UK listed REIT NewRiver Retail has acquired a portfolio of 158 pubs across England and Wales, at a net initial yield of 13.61%.
The Punch Taverns pubs have been bought for a total outlay of £53.5 mln (€73.1 mln), with the purchase funded by existing resources. NewRiver says it will arrange a new debt facility in due course.
The projected annual profit before tax of the portfolio is £6 mln, which will generate a cash on cash equity return in excess of 20%.
The acquisition brings the company’s total assets under management to nearly £1 bn, with pubs accounting for around 15%. NewRiver’s last major foray into the pubs branch was in November 2013, when it bought 202 premises from brewer-landlord Marston’s for £90 mln.
Property director Allan Lockhart said: ‘In many ways this Portfolio is similar to our Marston's transaction, in that we expect to deliver exceptional cash on cash returns and attractive capital growth through asset management and development. We are confident that this acquisition will add significant long-term value for our shareholders.’