German fund manager Union Investment has put a trophy office asset in the City of London up for sale within a year of acquiring it. Property adviser Savills has been instructed to bring 10 Gresham Street, London EC2 to the market for a price in the region of 拢180 mln (EUR 211 mln). The indication price reflects a a net initial yield of 5.65%.
German fund manager Union Investment has put a trophy office asset in the City of London up for sale within a year of acquiring it. Property adviser Savills has been instructed to bring 10 Gresham Street, London EC2 to the market for a price in the region of 拢180 mln (EUR 211 mln). The indication price reflects a a net initial yield of 5.65%.
Union Investment, acting on behalf of it UniImmo: Europa open-ended fund, acquired the prime asset from Standard Life for about EUR 165 mln in July 2009 in its first acquisition in the London office market for three years.
The landmark office headquarters was designed by Foster and Partners and completed in 2003. It comprises 260,000 square feet (25,125 m2) of office, retail and ancillary accommodation over seven floors with 30 car parking spaces. The property is let to eight tenants with Lloyds TSB accounting for 55% of the rent until August 2022 at a passing rent of 拢42.40 per sq ft overall.
Other tenants include Jones Lang LaSalle, Alcentra, Milbank Tweed Hadley & McCloy, Mondrian Investment Partners, Principal Global Investors and JC Flowers. The restaurant is let to Malfatti City Limited. The total annual passing rent is 拢11.3 mln per annum. The property has a BREEAM Certificate with a rating of 'Excellent'.
James Goldsmith, director of Savills Central London International team said: 'High quality, trophy assets in such a core City of London location rarely come available. This building is finished to the highest standard with excellent tenants on very modest rents and with rental growth forecast at 34% over the next four years, the property has excellent prospects for investment performance. There are also significant capital allowances available'.
Goldsmith confirmed to PropertyEU that Union Investment was under no pressure to sell the property. 'This is a good time to sell and Union Investment is just being a good fund manager,' he added.
Unlike Aberdeen Immobilien (formerly Degi) which recently sold three properties in London, Union Investment's UniImmo: Europa fund is not being forced to sell due to liquidity issues.
