CapitaLand Ascendas REIT (CLAR) has announced its first foray into logistics developments in the UK, with a significant investment of S$350.1 million (£203.5 million). The initiative involves acquiring two plots of freehold land in the East Midlands, a key logistics hub, to develop four new logistics properties. This strategic move is expected to boost CLAR’s UK logistics portfolio by 43.5%, increasing its asset value to approximately S$1.2 billion.
The developments will take place on land plots known as Manton Wood and Towcester, with one logistics property at Manton Wood and three at Towcester. William Tay, Executive Director and CEO of the Manager, highlighted the importance of this expansion, stating, “Embarking on our inaugural logistics developments in the UK marks a significant step forward in our strategy to scale up CLAR’s UK logistics portfolio.”
The East Midlands, known for its centralised location and connectivity, is a traditional logistics heartland in the UK. The region’s strategic position is underscored by its proximity to major cities and transport routes, making it an attractive site for logistics operations. The new properties will feature best-in-class building specifications and aim to achieve BREEAM “Excellent” certifications, enhancing CLAR’s green-certified assets.
The investment is expected to yield attractive net property income, with a stabilised yield of approximately 7.3% pre-transaction costs. The developments are also anticipated to be distribution per unit (DPU) accretive, with a projected improvement of 0.021 Singapore cents.
The acquisition of the land from DHL Real Estate (UK) Limited is set to complete in Q3 2025, with development commencing in the first half of 2026 and completion expected between 2027 and 2028. This expansion aligns with CLAR’s broader strategy to enhance its logistics footprint across key markets, including Singapore and the US.
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