SEGRO cautiously upbeat as it adds to Heathrow portfolio
European commercial property group Segro this week said it was restarting its development programme in response to specific occupier demand “with a carefully selected number of pre-let developments”, as there was limited new supply coming on stream.
Segro reported a rise in the level and quality of enquiries during the first quarter of 2010 as it announced an improvement in its overall vacancy rate to 14.6% from 14.8% at the end of the previous quarter. It also said rental levels had held up “reasonably well”.
Alongside its Q1 results, the group unveiled a £111.3m deal to buy BAA’s 50% stake in the Airport Property Partnership, a 50:50 joint venture with Aviva Investors that owns 17 industrial assets around the UK’s major airports totalling 3.5m sq ft plus a further three indirect investments. By value, 73% of the joint venture’s assets are in the Heathrow market.
Segro is now in talks with Aviva to expand the Airport Property Partnership by adding around £240m of Segro assets near Heathrow to the joint venture. This deal follows Segro’s acquisition last year of Brixton, an important player in the Heathrow area.
