ASSET MANAGER CLOSES £90m LOGISTICS FUNDING DEAL

Date: 13 October 2022

Miller Developments secures backing for 500,000 sq.ft. hub at £1bn North West site

Omega 400 at Omega Business Park

What: Aviva Investors finalises £90m logistics funding deal in North West

Why: Site owner, Miller Developments, secured Iceland on a 20-year prelet

What next: 505,000 sq.ft. hub to be delivered in October of next year

Aviva Investors has completed a £90m deal to forward fund a logistics facility at Miller Developments Omega Business Park in Warrington, React News can reveal.

The global asset management business is funding a high-specification distribution unit, which has been prelet to frozen food giant Iceland.  The deal equates to a net initial yield of around 4.25%, sources said.

Iceland Foods signed a 20-year lease at the 24 acre site.  At 505,000 sq.ft., it is the company’s largest distribution centre in the UK, serving the north of England, north Midlands and Wales.

“The credentials and partnership with a high-quality developer and leading occupier serving an essential sector of the economy, give us confidence that it will deliver strong sustainable income returns”

JAMES STEVENS, AVIVA INVESTORS

Omega Business Park is one of the largest distribution parks in north-west England, comprising 575 acres of land.  Once fully developed, it will provide approximately 5m sq.ft. of logistics units.

Last month Miller Developments locked in a £51m funding deal with Barings for a speculative logistics development at the site.  The investment manager is backing a 310,000 sq.ft. hub being delivered by Miller Developments.

Miller Developments, the trading name for M2 Group, continues to work up more projects at the £1bn Omega Park. Another logistics building – the 400,000 sq ft unit 4 – is next up for development, and M2 Group has secured a series of prelets to Lidl, McDonalds and Costa for a mixed-use component at the huge project.

“There will always be a market for the best locations and assets and this has been evidenced by Aviva’s decision to proceed with this deal at Omega Business Park.”

DAVID MILLOY, MILLER DEVELOPMENTS

In August Bellway Homes bought 13.5 acres at the site.

David Milloy, managing director of Miller Developments, said : Given recent market turmoil we are delighted to have completed the forward funding with Aviva Investors.  There will always be a market for the best locations and assets, and this has been evidenced by Aviva’s decision to proceed with this deal at Omega Business Park.

The unit was prelet to Iceland Foods earlier this year on a 20-year lease and construction work is now under way.  Completion will be in October 2023 and we look forward to working with Aviva and Iceland over the next year.

JLL advised Miller Developments.  Mason Owen acted for Aviva Investors.

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© 2023 M2 Group Ltd
Registered in Scotland
SC601917