Logistics real estate investor Tritax EuroBox has offloaded properties in Sweden and Germany for a combined total of €75 mln.
The company sold its redevelopment site in Malmö, Sweden, to a data center owner-occupier for SEK 320 mln (€28.1 mln), representing a price 39% above the valuation as of 31 March 2023, and 14% above the acquisition price.
Tritax EuroBox initially acquired the property in April 2021 for SEK 223 mln (€19.6 mln) with the intention of redeveloping it into a 60,700-square-meter logistics scheme. However, due to weakened market conditions, the expected returns from the development no longer justified proceeding with the project. As a result, selling the site for an alternative use became the more compelling option.
Alina Iorgulescu, commented: ‘The sale of Malmö is the third asset sold as part of the disposal programme outlined in our interim results. The sale reflects our conclusion that potential returns from the necessary capital investment for the redevelopment of the site were less attractive than disposing of the site for an alternative use and realises profits sooner than anticipated. The transaction is aligned with our strategy of recycling capital to reduce leverage and provides further evidence of Tritax EuroBox’s disciplined approach to capital allocation. Further disposals have been identified and we remain confident of achieving our target loan to value percentage of low 40s over the next 6 to 12 months.’
Separately, Tritax EuroBox offloaded a warehouse in Bochum to an undisclosed pan-European real estate investment firm for €46.8 mln. This represents a 3% decrease below the property's valuation as of 31 March 2023, and reflects a net initial yield of 4.88%.
The UK-based logistics company acquired the 37,047 m2 multi-unit warehouse in November 2018 for €37.8 mln. A new lease agreement was recently signed with Luchs GmbH, securing a rental rate 35% higher than the unit's current rent.
Tritax EuroBox intends to utilize the proceeds from both disposals to reduce debt, aligning with their plan to divest assets worth at least €150 mln over the next 12 to 18 months. Following the sale of Hammersbach in the summer and the recently announced Bochum transaction, gross sales signed to date amount to €139 mln.