CapitaLand Ascendas Reit proposes first UK logistics developments for an estimated S$350.1 million

CapitaLand Ascendas Reit (Clar) is proposing to launch its first logistics developments in the UK at an estimated total investment cost of S$350.1 million.

Clar is proposing to acquire two plots of freehold land in the East Midlands, a key logistics market in the UK, on which it plans to develop four new logistics properties, the manager said on Monday (Aug 11).

“The proposed developments align with Clar’s strategy to expand its logistics portfolio in the UK where demand is expected to be underpinned by e-commerce growth and occupiers’ evolving supply chain strategies,” the manager said on Monday.

William Tay, executive director and chief executive officer of the manager, highlighted that upon completion the four new properties are set to boost the assets under management (AUM) value of Clar’s UK logistics portfolio by 43.5 per cent to around S$1.2 billion.

This will grow the Clar’s UK logistics portfolio to 42 investment properties. It will raise the Reit’s UK portfolio value by 27.2 per cent to around S$1.6 billion, representing 10 per cent of the Reit’s total AUM of S$17.2 billion.

The manager noted that the properties are “strategic fits” with Clar’s existing logistics assets, which are spread across key industrial areas and established distribution centres in the UK, with good connections to core urban areas.

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The proposed addition of the four new properties to Clar’s portfolio will also capitalise on the demand for high-quality and well-located space, as they are situated in a logistics heartland in the UK, Tay added.

Of the four properties proposed to be developed on the two land plots, one is to be built at the Manton Wood land plot and three at the Towcester land plot.

Manton Wood offers easy access to local and national distribution routes, the manager noted. It is within a 4.5 hour drive from key consumer and manufacturing hubs across the north-east, north-west, Midlands and central London areas.

Towcester is in the UK’s logistics “Golden Triangle”, a region that has expanded due to the growth of warehouse and distribution premises, driven by online retail, supply chain reconfiguration, improved connectivity and demand for faster nationwide delivery.

Units of Clar finished Friday 0.4 per cent or S$0.01 lower at S$2.72.