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IO Asset Management has bought six multi-let industrial estates on behalf of Tesco Pension Fund (TPF) for a total of £27.3m.

The estates comprise 428,000 sq ft of space and their purchase reflects an average net initial yield of around 6.25% and a reversionary yield in excess of 7.5%, with a 16% vacancy.

These are the first purchases following IO’s appointment by TPF on a £60m segregated mandates to buy and hold multi-tenanted industrial and urban logistics estates with a value of £2m to £10m.

The purchased properties are:

  •  Pembroke Court in Runcorn comprises 150,000 sq ft 
  • Bishops Court in Warrington (110,000 sq ft)
  • Severn Link Distribution Centre in Chepstow (80,000 sq ft)
  • Old Mill Lane Industrial Estate in Mansfield (36,000 sq ft)
  • Centurion Court in Milton Keynes (24,000 sq ft)
  • Thames Trading Estate in Salford (31,000 sq ft)

Angus Scott-Brown, Managing Director of IO Asset Management, commented:

These purchases represent just under half of the original mandate to acquire multi-let industrial estates for Tesco Pension Fund. Our focus is on finding high quality properties with active management potential, and we are continuing to identify similar opportunities across the UK