The first Real Estate Investment Trust to be launched since the advent of REITs in January 2007 will specialise in neighbourhood retail. Castlemore Securities has unveiled plans to float The Local Shopping REIT on the London Stock Exchange, raising £160m of new equity.
The company is aiming to become the market leader in the local shopping market in the UK. It targets local shopping parades and neighbourhood venues for convenience or 'top-up' shopping and has been buying up stock since its formation in January 2005.
As at 28 February 2007, the company had built up a portfolio valued at £205.1m of property spread across 475 assets, with 1,465 letting units producing an overall net rental income of £13.6m pa. A further £16m of purchases are under offer at an average yield of just over 7 per cent.
Joint chief executives are Mike Riley and Nick Gregory, both formerly directors of Castlemore, with ex-Prologis director Victoria Whitehouse as finance director. Castlemore chairman Grahame Whateley will be non-executive chairman and Andrew Cunningham of Grainger and Nick Vetch of The Big Yellow Group non-executive directors.
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