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Rockspring signs Argos at new Reading urban logistics development

By Kasmira Jefford - Wednesday, October 11, 2017 9:31

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Rockspring Property Investment Managers has let one of the three units at its recently completed 256,000 sq ft Island Road logistics development in Reading to retail chain Argos.

Rockspring's TransEuropean Property Limited Partnership V fund (TEPV) acquired the Island Road site in 2014 and speculatively developed it as part of a wider strategy focusing on the sustainable development of urban or city fringe logistics facilities in the UK and continental Europe.

Located immediately to the south of Reading town centre, scheme was completed in May and comprises three units, with one spanning 73,000 sq ft let to Argos. Units A (127,000 sq ft) and C (56,000 sq ft) are still vacant. 

Construction has also recently begun at another of the fund’s logistics development schemes, on Test Lane in Southampton, close to the port, which is also being undertaken in partnership with Peel, who was also the development partner on the Island site. The site will offer approximately 206,000 st ft of space across three units and is expected to be completed during the second quarter 2018.

These two investments form part of a growing European portfolio of industrial and logistics properties totalling 1,751,108 sq ft, with a value of circa €1.2bn, that have been acquired by the firm since 2014.

Mark Krol at Rockspring said: “The development of urban logistics facilities across Europe has been a key component of our investment strategy since the global financial crisis and to that end, we are delighted to have secured such a high calibre occupier in Argos, and on attractive terms. With strong interest being shown in the remaining units, we hope to announce further lettings in the very near future.”

Jeremy Greenland at Peel Logistics Property added: “We’re pleased to have completed and let the first of three buildings at Island Road, Reading to Argos. The deal justifies our decision to speculatively construct the units and demonstrates the demand for strategically located industrial and urban logistics developments in the region.”

Launched in 2012, TEP V is a diversified, leveraged pan-European investment programme with a focus on office, retail and industrial properties in core Western Europe (including the UK). It is the fifth in Rockspring’s series of six TransEuropean Property Limited Partnerships and is fully invested with a portfolio of circa €700m.

Now in its maturity phase, the value-add fund’s strategy is focused on exploiting distressed capital market pricing and assembling a cash-flow generative portfolio that could be aggressively ‘managed to core’, utilising the firm’s Europe-wide platform and its hands-on asset management approach. Of the targeted return of 12% pa, approximately 50% is expected to derive from income.

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