LONDON (ShareCast) - (ShareCast News) - Property developer Segro has bought the remaining 50% stake in the Airport Property Partnership (APP) joint venture it does not already own from Aviva Group Entities for £365m.
The acquisition is to take advantage of the government's recent decision to build a third runway at Heathrow Airport as Segro expects expansion in the "medium to long-term" for space around the airport.

The acquisition, which is comprised of £216m in cash and the sale of £149m assets to Aviva, contains 21 direct property assets worth £1.09bn and totalling 350,000 square meters, 87% of which is located at Heathrow.

FTSE 250-listed Segro initially bought the original 50% stake in APP in June 2010 and was asset manager for the joint venture while Aviva Investors was the fund manager.

Last year, the properties in the portfolio generated annual rent of £42m with a further £6m payable after expiry of rent-free periods, which had a net initial yield of 3.6% that will rise to 4.2% on expiry of the rent periods.

Segro chief executive David Sleath said: "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."

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