The Royal Mail has secured a 111,000 sq ft warehouse in Beckton, East London, which it will use as a distribution and sorting centre.
The 111,415 sq ft facility known as Unit 1, Gemini Business Park has been taken on a 15 year lease at a rent in the region of £8.60 per sq ft.
The building owned by Aviva was the largest single building at the 25-acre park which was built by the LDA in a joint venture with developer Goodman, to offer accommodation for businesses that were displaced by the Olympic Park development in East London. LOCOG, the Olympic organising body, previously occupied the building on a lease until December 2012. On expiry of the LOCOG lease, the strategy was to refurbish, market and re-let the unit to take advantage of forecast tenant demand for modern, well-specified distribution warehouse accommodation within the M25. The building was vacant for less than 6 months.
By refurbishing the unit to create a grade A specified property, Aviva has been able to maximise rental income with The Royal Mail’s rent being a 33 per cent increase on the rent payable by LOCOG. In addition, the building specification and quality has enabled the fund to secure a 15 year lease.
Philip Butler at Aviva Investors commented “that the minimal void period was particularly beneficial to the owning Fund, and demonstrated both the high levels of specification offered by the building, and the shortage of supply of similar space within the M25”.
Aviva Investors were advised by Jones Lang LaSalle, Glenny and Frankis Porter. Royal Mail was advised by Capita Symonds.