Logistics property developer Chancerygate, in a joint venture with CBRE Investment Management (CBRE IM), has secured an £18m senior loan from Investec Bank for the development of The Works - a 93,000sq ft, Grade A industrial scheme in Croydon, South London.
Construction started on the The Works last month. Once complete the scheme will consist of three buildings subdivided into 15 units.
These will range in size from around 2,400sq ft to circa 16,000sq ft, with an option to combine units, which the joint venture said will be “ideally suited” for third-party logistics and distribution occupiers.
The project is targeting a BREEAM Excellent certification and an EPC A+ rating as a minimum for all units.
Features will include EV charging points, 76 secure cycle parking spaces and PV panels on all units, which are designed to utilise materials that maximise energy performance.
The Works is located in a predominantly industrial area to the north-west of central Croydon and ten miles south of central London.
The site is nine miles from Junction 7 of the M25 motorway.
Chancerygate currently has around 1.41 million sq ft of urban logistics space under construction or ready for development at 11 sites across the UK.
A report from the Industrial Land Commission in 2022 revealed that over the last 20 years, London had lost a quarter (24% of its industrial floorspace, the equivalent to 840 football pitches.
New supply within the inner M25 region remains constrained with less than two years of supply across most size bands and Grade A comprising just 40% of currently available space, despite it accounting for the majority of demand.
Tom Griffiths, Investec director, commented: “Take up for sustainable, well connected I&L space in London, where proximity to the capital’s nine million residents and one million businesses is crucial for occupiers, remains robust.
“With increasing competition from alternative land use, in particular new housing, squeezing new supply, the rental growth prospects for the sector remain very compelling.
“This latest facility kickstarts an exciting new relationship with a major institutional manager in CBRE IM and furthers our strong, longstanding relationship with Chancerygate, building on the Real Estate team’s considerable track record funding best-in-class, experienced counterparties operating in the small to mid-box industrial market.”
Tom Berens, CBRE IM senior director, said: “Securing this loan marks a significant milestone for our fund’s growth ambitions. We are delighted to team up with Investec, further strengthening their long-term relationship with our JV partner Chancerygate.
“We continue to see attractive returns in the logistics sector when delivering sustainable, high quality assets in areas with constrained supply.”
Michael Treliving, chief financial officer at Chancerygate, added: “The Works is the first multi-unit urban logistics scheme to be developed in Croydon for 10 years and will help meet the region’s demand for high-quality, sustainable accommodation.
“We’re very pleased to once again have Investec’s trusted support for one of our developments. Most importantly, it further enables the ability of our partnership with CBRE IM to deliver a nationwide portfolio of much-needed urban logistics assets.”
Carol Millett is an award-winning freelance journalist with over 30 years’ of experience writing across a broad range of sectors, including road transport, construction and civil engineering, project management, private finance, technology, HR, and travel and tourism.View full Profile
