London-based long-income specialist LXi REIT has sold a retail park in St Albans, UK, to an unnamed UK institution for £31 mln (€36 mln).
The deal reflects a net initial yield of 4.7%.
The property is let to B&Q (62% of rent), Aldi (28%) and Costa Coffee (10%), and has a weighted average unexpired lease term of 18 years.
Aldi leases 1,724 m2, while B&Q uses 4,303 m2 of retail space.
LXi bought the property through a forward funded purchase for £24 mln (€28 mln) in June 2019.
The sale price is in line with the 31 March 2023 book value, generating an 11% internal rate of return.
According to LXi REIT, the net sales proceeds will be used to reduce leverage and, potentially, to be invested in the higher yielding pipeline.
LXI REIT invests in commercial property assets predominantly in the UK, let, or pre-let, on long (20-30 years to expiry or first break), inflation-linked leases to a wide range of strong tenant covenants across a diverse range of robust property sectors.