Portfolio: Commercial Property: Current

Purpose-Built R&D Facility in Cambridge

Raising capital?

In March 2018 we completed a property investment into a purpose-built R&D facility in the thriving Cambridge biotech cluster.

Investment highlights

  • Investment typeCommercial Property
  • Date of investmentMarch 2018

The planned 37,500 square foot property is pre-let on a 25-year lease to Cambridge Nutritional Sciences Ltd, a leading developer and manufacturer of food intolerance tests whose products are distributed in over 75 countries.Strong demand for laboratory space in Cambridge has seen prime open plan laboratory rents rise by 17% since 2014. This upward pressure on top rents comes as the availability of office and R&D space in the city has fallen by 90% in the five years to 2017. Cambridge now has the highest top rents of any UK city except London.

The project was purchased for £8.75million and has a gross development value (GDV) of £9.7million on completion. The deal included a senior debt facility at a 60% loan to value (LTV).
The net initial yield will be 6.68% once the property is income-producing early next year, and Connection Capital is targeting a 6% annual distribution from that point. Rent reviews will be inflation-linked, subject to a 2% collar and a 5% cap.

Our Commercial Property Team

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