Brixton plc will become Britain’s biggest industrial landlord through the acquisition of a Â£675 million portfolio (net value Â£250 million) from subsidiaries of Industrious Holdings (Jersey) Ltd.
The portfolio contains 163 properties, of which about 50 will be sold on completion. Brixton’s total assets will rise from Â£1.723 billion in June to Â£2.398 billion, and its gearing will rise from 61% to 131% before settling back to an 85-90% range after the selloffs.
Brixton dominates the Heathrow & West London markets, recently bought Trafford Park in Manchester and will expand its Manchester interests through this acquisition, and will establish itself in Birmingham.
Brixton chief executive Tim Wheeler said the expansion into a Â£2 billion company would raise its profile among investors in the US & Europe.
The Industrious portfolio shows a 6.9% net initial yield, 7.5% equivalent yield & 7.6% reversionary yield. Mr Wheeler said the transaction should enhance earnings from completion, with potential for cost synergies.
Industrious founder & chairman John Saville retired in 1999. Saville Gordon Estates plc was taken over in 2002 by Morgan Stanley Real Estate Fund and senior executives of the company, changed its name to Industrious Ltd then transferred ownership of the business last year to Industrious Holdings (Jersey) Ltd.
Full details of the deal, including comparative industrial rents & returns, are on the Brixton website. The deal still requires Brixton shareholder approval.