Barkby Group unveils plans for portfolio of roadside assets worth £250M via joint venture
Abingdon-based Barkby Group has unveiled plans to create a portfolio of modern roadside assets worth £250 million by forming a joint venture (JV) with New York and London-based real estate private equity manager Meadow Partners LLP.
The JV will focus on acquiring sites where it can offer consumers a mix of Drive Thru, Foodvenience, Local Logistics and Trade Counter businesses alongside opportunities to increase electric vehicle (EV) charging facilities, the company said.
READ MORE: Abingdon's Barkby Group completes first Roadside development
It is to be funded by up to £100 million of equity with an intention to add appropriate levels of further leverage and is aiming to achieve a double-digit portfolio internal rate of return (IRR) over a 30 month period of initial investment.
In a stock market statement, Barkby also revealed it intends to change its name to 'Roadside Real Estate plc' to reflect the strategy alongside a proposed share consolidation.
"We are delighted to be working with Meadow to implement a fully funded strategy to institutionalise a new asset class within the real estate sector," said Charles Dickson, Barkby's executive chairman.
"Roadside Real Estate will offer exciting potential for investors and we believe this JV has the opportunity to create a portfolio worth £250 million over time.
"Having successfully developed a small number of roadside sites which have proven our concept, we will seek to rapidly convert our acquisition pipeline to create value for shareholders and our joint venture partner, whilst delivering valuable community amenities - not least increased access to electric vehicle charging."
The company told investors that it had "explored" a variety of options to fund its strategy amid challenging markets and the JV represented the "best structure" to support it.
The venture has a prospective Roadside Real Estate investment pipeline in excess of £150 million as more stock comes to the market and additional approaches are being made to the company by vendors, it added.
The pipeline includes a site in Stoke, currently owned by Meadow, which the JV may consider an initial acquisition though that is still subject to due diligence and negotiation. In addition, Barkby's existing wholly-owned portfolio already comprises Wellingborough, which achieved practical completion in May 2023 and is fully let, and Maldon, which is expected to reach practical completion imminently Both schemes, the JV may consider as investments, said Barkby.
Under the terms of the deal, Meadow will own and fund 97% of the joint venture, while Barkby will own and fund 3%.
Barkby may exercise an additional invetment option within the first 12 months following the JV's establishment, to increase its ownership percentage up to a maximum of 10%.
It noted that there could be no guarantees that the JV will ever drawdown the full £100 million of equity available to it and thus that Barkby will ever be required to fund the maximum £10 million equity commitment to the venture even if the full 10% additional investment were taken up.
The company also reported that it was in negotiations with a potential non-executive chairman.
Upon the appointment of a chair, Dickson would become the chief executive.
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