Cromwell E-Reit to divest 3 assets for 22m euros, above valuation

CROMWELL European Real Estate Investment Trust (Cromwell E-Reit) is selling 3 of its non-core, light industrial/logistics assets at a total consideration of 22 million euros (S$30.6 million).

In a midday filing on Friday (Sep 9), the Reit manager said this represents a 28 per cent premium to the properties’ combined valuations as at end-June 2022. The divestment is expected to complete in Q4 2022.

Two of the 3 assets, Bischofsheim II and Hanau, are located in Germany.

Bischofsheim II is a 50-year-old commercial and logistics park with a 7,158 square metre net lettable area. It was acquired for 3.5 million euros.

On the other hand, Hanau is a 51-year-old business park acquired for 2.9 million euros. It was more recently extended in 1996, and comprises a 3-storey office block and a single-storey warehouse with an attached set of small office suites.

Bischofsheim II and Hanau were both independently valued by CBRE at or around 5 million euros each. They will be divested at considerations of 6 million euros and 5 million euros (at valuation price) respectively.

Another asset, Bois du Tambour, is located in France about 10 km from the centre of Nancy. The building was constructed between 1980 and 1982 and consists of 5 main separate structures housing a mix of light industrial/warehouse space and associated offices.

It was acquired for 2 million euros, and has been valued by Savills at 7.1 million euros. The asset will be divested for a consideration of 11 million euros.

All 3 assets were acquired at the Reit’s November 2017 initial public offering (IPO) to form part of its IPO portfolio.

SEE ALSO

Cromwell E-Reit H1 DPU rises 2.3% to 8.695 euro cents

Cromwell E-Reit divests Finland office asset; acquires third UK logistics asset

Cromwell E-Reit Q1 distributable income up 7.1% to 23.3m euros

Cromwell E-Reit’s Lovosice asset secures 40% of pre-leases for new warehousing unit

More

The manager’s chief executive Simon Garing said the asset management plans and associated leasing programmes for the 3 older-style warehouses were recently fulfilled, with the Reit’s team executing the sales at some 13.6 million euros above the aggregate IPO purchase price of 8.4 million euros in 2017.

“This is testament to the local teams’ ability to identify and manage value-add opportunities, realising strong gains for investors,” added Garing.

Proceeds from the divestment of these properties will be deployed into repaying Cromwell E-Reit’s revolving credit facility, and/or for other working capital purposes.

Units of Cromwell E-Reit were trading 0.01 euro cent or 0.5 per cent lower at 1.99 euros as at 1.06 pm on Friday, after the announcement was made.