There has been strong bidding for 10 Stratton Street, a trophy Mayfair office being sold by an investor club advised by Hong Kong group Joint Treasure with a guide price of £100 million.
JLL and Savills are advising on the sale.
The building is leased at an average passing rent of £90 per square foot, which is significantly reversionary in an area where rents have been secured at in excess of £200 per square foot. It represents a core plus investment with the opportunity to drive value through active asset management.
It is understood to have drawn bidding from a number of well established private equity investors active in the central London core and core plus office market at prices in the region of £95 million, with parties understood to include CLI Dartriver, DWI Group, Ares, Lone Star, JP Morgan Asset Management and Northtree Investment Management.
But market sources said a bid at significantly in excess of the £100 million asking price from an outlier new entrant has drawn the vendor's interest.
The sources, who declined to be quoted given the sensitivity of negotiations, suggested the bidder is European real asset investment and asset management firm Catalyst Capital. The group has not been investing in London offices in recent times but focusing on other sectors in Europe and smaller lot sizes.
The 41,577-square-foot office and leisure building is located in Mayfair less than 1 minute’s walk from Green Park station. It is arranged over lower ground, ground and seven upper floors and fully let to eight office tenants and one gym operator.
There is a weighted average unexpired lease term of 3.6 years to expiries and 2.3 years to break options. The 1990-built office was comprehensively refurbished in 2017. It has private terraces on four floors.