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Segro move paves way for Heathrow Cargo Centre revamp
[ March 10, 2017 // Chris ]Property firm Segro has boosted its involvement in the Heathrow market by acquiring the 50% stake in its Airport Property Partnership joint venture from its former partner, Aviva Investors, for £365 million – a move which could pave the way for the long-awaited redevelopment of Heathrow Cargo Centre.
APP includes most of Heathrow airport’s airside cargo facilities. It portfolio consists of 21 pieces of property, valued at £1,097 million and totalling 350,000 sq m, 87% of which (by value) are at Heathrow.
Segro chief executive, David Sleath, said that while the partnership with Aviva had delivered excellent performance over the last five years, “we believe now is the right time to take full control and ownership over APP in which we see a number of opportunities to realise further value from its unique portfolio in the short and long term. We look forward to pursuing our development plans, taking advantage of strong occupier demand for facilities around Heathrow from customers needing rapid access both to the airport and to Central London.
“Our Heathrow portfolio is one of the jewels in our crown and we are delighted to be able to add scale in this supply-constrained market.”
Currently there is one development underway, at the North Feltham Trading Estate, where 7,300sq m of new urban warehouse s are being built, but there are also a number of other sites suitable for either near-term in-fill developments or longer-term redevelopment.
Segro says that the most significant of these is the 1960s-built Heathrow Cargo Centre which requires redevelopment to cater for the current needs of cargo handlers and to expand its capacity to meet occupier demand for space.
The government’s decision to support a third runway at Heathrow should also increase the volume of cargo passing through Heathrow and with it demand from airlines, airport and airline service companies, cargo handlers and other users of industrial property for the limited space in and around the airport.