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Custodian REIT sells central London warehouse for £4.4mln above book value

Published: 11:01 28 Sep 2018 EDT

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The cash will be used to fund acquisitions that will enhance dividend cover

Custodian REIT PLC (LON:CREI) has sold a 22,000 square-foot industrial unit in Southwark, south London for £12mln, some £4.4mln more than what the UK property investor valued it in June.

The warehouse was bought back in 2014 for £3.1mln as part of the initial portfolio Custodian acquired on its admission to the London Stock Exchange. The company, which is valued at £500mln, plans to use the proceeds to fund acquisitions that will enhance dividend cover.

“The lack of available investment stock in Central London combined with strong investment demand and a recent, substantial rental increase has led to significant valuation increases,” said Richard Shepherd-Cross, managing director of Custodian Capital, the firm’s external fund manager.

“Over and above this, redevelopment potential and identification of a special purchaser has delivered a substantial profit over and above the most recent valuation.”

Shares were down 121.8p in late afternoon trading on Friday.

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