Strategic Report Portfolio Review continued
Portfolio activity Swiftbox, Rugby, was our largest void at the beginning of the year. Following completion of the refurbishment, we leased the entire 99,500 sq ft distribution unit to UPS, on a 12-month lease, with the option to extend for up to a further six months. UPS has taken up the option, so the lease now expires in March 2022. The letting immediately generated an annual income of £0.6 million, which was 4% ahead of ERV. At Parkbury, Radlett, we have driven income though active management. Two rent reviews were agreed, increasing the passing rent by 25%, one lease was renewed for a further 15 years, subject to break, at a rent 35% ahead of the previous passing rent and we extended a lease by five years to 2031, securing £0.3 million per annum. At Vigo 250, Washington, we were pleased to be able to provide cash flow assistance as an incentive and settle the June 2021 rent review, securing a 5% uplift to £1.2 million per annum, 12% ahead of ERV. At River Way, Harlow, we restructured a lease and secured longer income until March 2023. As part of the same transaction, the August 2021 rent review was brought forward to January 2021 and settled, securing a 27% uplift to £0.8 million per annum, 27% ahead of ERV. Two further rent reviews were agreed, increasing the passing rent by 11%, one lease was renewed for a further five years, at a rent 15% ahead of the previous passing rent, and two units were leased for a combined £0.2 million per annum, in line with ERV. At Datapoint in London E16, following the completion of a rent review, we achieved a 68% uplift in rent to £0.4 million per annum, 24% ahead of ERV. One unit was leased for a minimum term of five years at a rent of £0.1 million per annum, 7% ahead of ERV. At Sundon Business Park, Luton, following the completion of a rent review, we achieved a 57% uplift in rent to £0.1 million per annum, 11% ahead of ERV. Three leases were renewed, the passing rent increasing by 47% to a combined £0.3 million per annum, 10% ahead of ERV.
Outlook The Covid-19 pandemic has had a limited impact on the industrial sector, with strong demand, low vacancy rates and increasing rents, especially in respect of the smaller multi-let estates. Where occupiers have been affected by the pandemic, we have been able to work with most of them to resolve the position, and if needed, usually these units are easily re-let. We do not anticipate a slowdown in demand, and combined with limited stock availability we expect continued rental growth, especially in respect of the smaller units in Greater London and the South East, where there remains a lack of supply and a limited development pipeline. We do not expect rental growth to come through on the larger units to the same extent, due to the development pipeline, and the ability for occupiers to build bespoke space. The focus going forward is to maintain high occupancy, continue to capture rental growth, and work proactively with our occupiers to unlock asset management transactions. We have 24 lease events forecast for the coming year, and the overall ERV for these units is 23% higher than the current passing rent of £2.2 million. This provides us with the opportunity to grow income and value further.
Industrial
The industrial sector, which accounts for 53% of the portfolio, again had the strongest sector performance of the year producing double digit returns. This was a result of the portfolio being almost fully let, active management extending income, securing rental uplifts and continued strong occupational demand for the smaller units, which resulted in further rental growth, especially in London and the South East. This, combined with continued strength in the investment market, has resulted in another strong year for this element of the portfolio. On a like-for-like basis, our industrial portfolio value increased by £42.4 million or 13.3% to £360.7 million, and the annual rental income increased by £0.9 million or 5.6% to £16.9 million. The portfolio has an average weighted lease length of 4.3 years and £2.4 million of reversionary potential. We have seen ERV growth of 3.9% across the portfolio and are experiencing demand across all of our estates. Occupancy is 99.8%, with the only void being one small unit in Wokinghamwhich has recently been refurbished.
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