Property investment manager CCLA has purchased a portfolio of car showrooms for its Local Authority Property Fund at a cost of around £42m.
All of the properties have long leases at RPI-linked rents and are located in the suburbs of London, with future values underwritten by alternative site uses, the fund said.
John Kelly, director of client investments at CCLA, said the purchase offers “a strong combination of an immediate contribution to returns with the potential to add to capital values over time. Cash flows into the fund continue at a high level and it is important to be innovative to maintain the momentum of returns when some significant parts of the sector – such as retail – are under a cloud.”
In May, CCLA announced that the property fund had recently broken through the £1bn mark of local government assets under management.
