US realty subsidiary pumps millions into Suffolk developments
The real estate investment arm of a Wall Street-quoted $1 trillion US corporation has provided a £21.5 million loan facility to underpin development of two logistics hubs in Suffolk valued at £35m.
Jaynic and PGIM Real Estate have partnered to develop the units at Suffolk Park, Bury St Edmunds.
PGIM Real Estate, which acted for institutional investors in the deal, is part of PGIM, the global investment management corporation headquartered in the US and trades on the New York Stock Exchange.
A £13m contract has been let to Readie Construction and building of the two units of approximately 147,000 sq ft and 206,000 sq ft respectively, on a 19-acre plot will start at the beginning of May.
PGIM Real Estate’s loan finances 95 per cent of costs for the site acquisition and development which is expected to complete in November.There is potential for an occupier to start racking/fit-out about one month earlier. Forecast rental values are £5.95 per sq ft based on standard FRI lease.
The BREEAM excellent development has 12.5 m clear height, 50m deep service yards, level access and dock loading together with ancillary offices.
Ben Oughton, development director with Jaynic, said: “These units will be the only speculative development in this area currently being undertaken. It will provide much needed stock that can be delivered before the end of 2018 setting the scheme apart from other development sites in the vicinity, where lead in and occupation lags by anywhere between 12 – 24 months.”
Andrew Macland, managing director and head of UK at PGIM Real Estate added: “We are proud to be Jaynic’s funding partner for this scheme as its expertise and track record exemplifies our partner-led investment approach. This well-located site in a currently under-served area for logistics properties will offer our investors access to a strongly performing sector. Jaynic has a strong development pipeline and we are looking forward to establishing a long-term relationship through further projects together.”
The development is part of a broader initiative with St Edmundsbury Borough Council and housebuilder Taylor Wimpey to support a range of new and existing businesses in the popular Bury St Edmunds area and to continue to create jobs and prosperity.
The infrastructure, including all utilities and the main estate road, and landscaping contracts for Suffolk Park have been let and are due for completion in the next few weeks.
Bury St Edmunds is the primary commercial and administrative centre for West Suffolk and boasts a variety of service sector, production and manufacturing occupiers including major national operators such as Sealey, Greene King, British Sugar, DHL, Century Logistics, Treatt, Servest, Mizkan and Taylor Wimpey.
Jaynic has been responsible for the creation of a number of major employment sites in the region including Cambridge Research Park, Buckingway Business Park, Cambridge, University of Essex Knowledge Gateway, Colchester, Haverhill Business Park and Haverhill Research Park.
Agents for Suffolk Park are Savills and Hazells.