30/06/10
By Andrew Holt
Mayfair Capital Investment Management’s Property Income Trust for Charities (PITCH) has completed its latest acquisition in the form of the Debenhams’ Department Store in Southport.
The price paid, £8.3 million, reflects an initial yield of around 6%, whilst the lease prescribes for annual uplifts of 3% per annum until 2014 and 2.5% per annum to 2019.
Thereafter, reviews will be based to the higher of 2.5% per annum or open market rental value.
James Thornton, fund director at Mayfair Capital, said: “This latest acquisition fits the profile for the Fund, generating an attractive yield with predetermined annual increases, thereby building income growth into the return profile without reliance on market reviews at a time when the retail occupier market remains subdued.”
James Thornton continued: “With continuing low interest rates and firm gilt market pricing in the wake of the emergency Budget, property is a natural asset for charities seeking high levels of income.
"The fact that leases prescribe for quarterly in advance rent payments makes the income from commercial property both secure and predictable. It is not surprising therefore that institutional investors are switching their asset allocations away from equities towards fixed interest and property.”
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