One is to buy for capital appreciation and manage lightly until disposal. The other is to buy for income and operate the asset properly for as long as you hold it. They lead to different acquisitions, different lease decisions and different maintenance behaviour, and they are difficult to pursue simultaneously.
The group takes the second. That means an asset must make sense on the income it produces while operated, because there is no assumed exit doing the work in the underwriting.
The standard the group uses for acquisitions — never own something you cannot run yourself — is a property discipline as much as an industrial one. An asset requiring management the group cannot supply is not a good asset for the group, whatever the yield suggests.
The commercial portfolio runs alongside industrial and warehouse space, under the same management approach. Both are held on one balance sheet with the group’s four other platforms, which is what allows the holding period to be genuinely long.
What this covers
Questions
Commercial and industrial assets held for income under the Twosqft brand, rather than assembled for trading.
On the income the asset produces while operated, with conservative assumptions about exit, because disposal is not the plan.
A long hold removes the incentive to defer maintenance and makes tenant retention more valuable than headline rent.
The platform is oriented to holding and operating income-producing assets rather than to development for sale.
The portfolio sits on the same balance sheet as the group's four other platforms, which is what makes a genuinely long holding period possible.
Continue
Reach the property desk.