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TORONTO, Nov. 18, 2022 /CNW/ - Padlock Partners UK Fund III (the "Trust") announced today that it has successfully completed the acquisition of the freehold interest in the land and building at The Depository, South Road, Brighton BN1 6SB (the "Property") in the United Kingdom via a share purchase agreement of the company Store 2 Capital Limited. Total deal capitalization including expected capital expenditures was £10,289,000.
The Property was purchased via a subsidiary of the Trust (the "Buyer") pursuant to a share purchase agreement, whereby the Buyer agreed to acquire 100% of the outstanding shares of Store 2 Capital Limited. In addition, the rights to acquire a vacant industrial leasehold property in the busy seaside community of Seaford, being the land and Buildings at Unit 4 Cradle Hill Industrial Estate, Seaford, East Sussex, BN25 3JE, were secured as part of this transaction for total deferred consideration including capital expenditure estimate of £2,711,000 following the satisfaction of a consent receivable from the freeholder.
The Brighton property is an operating self-storage facility with expansion approvals located 45 miles south of London. The purchase and expansion of the Property present the unique prospect of being one of the highest-quality self-storage facilities in Brighton. The existing self-storage business contains approximately 13,300 of net rentable square footage. The Property recently received planning approval to add 10,600 additional net rentable square feet for a total when completed of 23,900 nrsf. The additional expansion is expected to take 10 months to complete.
The Seaford property is an existing vacant warehouse with preliminary expansion/fit out approvals for self-storage. The property is located 50 miles south of London and is 13 miles east of the Brighton Property. The option to purchase this site is contingent on the satisfaction of securing property and council consents. The potential purchase of the long leasehold and expansion of the property present the opportunity of being the only self-storage facility in Seaford. The existing Seaford warehouse contains approximately 15,605 square feet. The property recently received preliminary planning approval to expand the building and reclad the exterior. The proposed fit out/expansion will increase the total net rentable square feet to 23,900 and is expected to be completed within 12 months of acquisition.
"We are pleased to acquire the Brighton property and the rights to acquire the Seaford property in such strategic locations on the South Coast. The bustling commercial, retail and residential catchment should provide for numerous opportunities for us to serve our customers and the community. This acquisition allows us to execute on our strategic priority to build a strong income-producing portfolio focused on self-storage in the UK and pairs well with our recent Watford and Woking self-storage development sites," said Padlock Partners UK Fund III CEO, John Stevenson.
This transaction marks the 3rd Padlock Partners UK Fund III location in the United Kingdom and includes the rights to acquire a 4th location. The Trust has previously acquired self-storage development properties in Watford and Woking ? both within the London MSA. The Trust intends to acquire one or more additional properties in the United Kingdom, consistent with the Trust's investment objectives to provide unitholders with an opportunity to invest in a portfolio of diversified income-producing commercial real estate properties in the United Kingdom, with a particular focus on self-storage properties.
The Trust is an unincorporated investment trust and was established for the primary purpose of investing in a diversified portfolio of income producing commercial real estate properties in the United Kingdom with a focus on self-storage properties.
This news release contains statements that include forward-looking information within the meaning of Canadian securities laws. These forward-looking statements reflect the current expectations of the Trust, Clear Sky and the Manager regarding future events, including statements concerning the expected closing of the Trust's acquisition of the Brighton and Seaford Properties and the anticipated use of proceeds of the Offering. In some cases, forward-looking statements can be identified by terms such as "may", "might", "will", "could", "should", "would", "occur", "expect", "plan", "anticipate", "believe", "intend", "seek", "aim", "estimate", "target", "project", "predict", "forecast", "potential", "continue", "likely", "schedule", or the negative thereof or other similar expressions concerning matters that are not historical facts.
Material factors and assumptions used by management of the Trust to develop the forward-looking information include, but are not limited to, the Trust's current expectations about: the availability of properties for acquisition and the price at which such properties may be acquired; the availability of mortgage financing; the Manager's expectations regarding the expected timeline for the Trust's development plans in respect of the Brighton and Seaford Properties; the Manager's expectations regarding the operation and development of the Brighton and Seaford Properties, including, but not limited to, the planned conversion of open warehouse space into self-storage units; the capital structure of the Trust; the global and United Kingdom economic environment; the impact of negative geopolitical events, including the conflict in Ukraine; foreign currency exchange rates; and governmental regulations or tax laws. While management considers these assumptions to be reasonable based on currently available information, they may prove to be incorrect.
Although management believes the expectations reflected in such forward-looking statements are reasonable and represent the Trust's internal projections, expectations and beliefs at this time, such statements involve known and unknown risks and uncertainties that may be general or specific and which give rise to the possibility that expectations, forecasts, predictions, projections or conclusions will not prove to be accurate, that assumptions may not be correct and that objectives, strategic goals and priorities may not be achieved. A variety of factors, many of which are beyond the Trust's control, could cause actual results in future periods to differ materially from current expectations of estimated or anticipated events or results expressed or implied by such forward-looking statements. Such factors include the risks identified in the final prospectus of the Trust dated July 11, 2022, including under the heading "Risk Factors" therein, as well as, among other things, risks related to the availability of suitable properties for purchase by the Trust, the availability of mortgage financing for such properties, and general economic and market factors, including interest rates, prospective purchasers of real estate, business competition, negative geo-political events, changes in government regulations or income tax laws. Readers are cautioned against placing undue reliance on forward-looking statements. Except as required by applicable Canadian securities laws, the Trust undertakes no obligation to update or revise publicly any forward-looking statements, whether as a result of new information, future events or otherwise, after the date on which the statements are made or to reflect the occurrence of unanticipated events.
SOURCE Padlock Partners UK Fund III
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