Development Securities acquires £8.3 million mixed-use real estate opportunity in Romford
Development Securities today announces the £8.3 million acquisition of Tollgate House and Market Place, a 104,400 sq. ft. mixed-use, town centre opportunity in Romford, Greater London, from administrators acting on behalf of Lloyds Banking Group. The acquisition includes the part-freehold and part-long leasehold of three real estate assets with development potential and opportunities to drive value through asset management.
Tollgate House is a prominent building in Romford town centre which includes 8,100 sq. ft. of office space and 2,500 sq. ft. of retail space. The building is 93 per cent let with plans to increase occupancy and enhance income through minor refurbishment works. Market Place comprises two phases: the first phase includes 44,300 sq. ft. of retail space which is 78 per cent let to national and local retailers including Aldi, Boots and Iceland. In addition, this phase includes 69 residential apartments from which ground rents are generated.
The second phase is a part-built, mixed-use development which will take nine months to complete and comprises 35,200 sq. ft. of retail space and 22 residential apartments.
The blended initial yield across the assets is currently 8.01% with a weighted average lease length of 13.1 years. Capital expenditure of £3.2 million is required to complete the development.
Michael Marx, Chief Executive, Development Securities PLC said: "We have completed several deals with banks over the past few years and this latest acquisition from Lloyds Banking Group enhances our track record as a trusted partner on complex real estate transactions of this nature. This acquisition offers significant asset management and enhancement opportunities and supports our strategy of creating value through real estate regeneration."
Tollgate House and Market Place are located in the centre of Romford, close to Romford station which is set to benefit from connection to Crossrail in 2018, enhancing the Company's pipeline of Greater London, Crossrail projects.