Padlock Partners UK Fund I (the “Trust”) announced today that it has successfully completed the sale of a newly developed self-storage property located in the United Kingdom (the “Newmarket Property”) to a subsidiary (the “Buyer”) of Padlock Partners UK Fund II (“Padlock II”) for an aggregate purchase price of approximately £6,680,000. The Newmarket Property was sold by a subsidiary of the Trust (the “Seller”) to the Buyer pursuant to a share purchase agreement, whereby the Buyer agreed to acquire 100% of the outstanding shares of a subsidiary of the Seller holding the Newmarket Property (the “Acquired Subsidiary”).
Prior to the sale, the Acquired Subsidiary had entered into a loan facility with the Buyer (the “Loan Facility”) on June 24, 2021, and provided the Buyer, as lender, with a purchase option to allow the Buyer to purchase an interest in the Acquired Subsidiary, which was exercised by the Buyer in order to pursue the acquisition of the Newmarket Property discussed herein. Upon completion of this transaction, the Loan Facility is no longer the obligation of the Trust.
After giving effect to working capital adjustments and the balance owed to the Buyer by the Acquired Subsidiary on the Loan Facility in the amount of approximately £5,441,122, the adjusted purchase price of approximately £735,940 was satisfied by way of deferred consideration due and payable by the Buyer to the Seller on or before June 24, 2022. Such deferred consideration may be further adjusted for additional working capital adjustments as agreed to between Buyer and Seller.
The Newmarket Property is a recently developed self-storage property that is located in an affluent suburban market approximately 50 miles northeast of London. On November 11, 2020, the Trust completed its indirect acquisition of a freehold interest in the Newmarket Property. On June 24, 2021, the completion of the warehouse being constructed on the Newmarket Property was completed and the Trust took possession of the building. The project and office were completed during the financial year ended December 31, 2021, and the Trust began to lease up the units in the fourth quarter of 2021.
“We are happy to capture strong value for the Trust via this disposition which will allow us to continue to execute on our strategic development and operational priorities.” said Padlock Partners UK Fund I CEO, John Stevenson.
About Padlock Partners UK Fund I
The Trust is an unincorporated investment trust and was established for the primary purpose of investing in a diversified portfolio of income producing commercial real estate properties in the United Kingdom with a focus on self-storage and mixed-use properties. After giving effect to the sale of the Newmarket Property, the Trust holds properties in Bicester, Letchworth, Leighton Buzzard, Wimbledon, Chippenham and Enfield.