Pontegadea, Spanish billionaire Amancio Ortega's real estate businesses, has completed its acquisition of 33 Foley Street in London's Fitzrovia from Abrdn, as a major City investment has gone under offer for around £260 million and a series of bidding processes across the capital lift sentiment.
CoStar News revealed last month that the prolific real estate investor had gone under offer to buy the former BBC office for around £80 million. The sale has now completed for around £81 million or a circa 4.43% yield, CoStar News understands.
The Standard Life Investments Long Lease Fund bought the building from Kier Property in a sale-and-leaseback transaction in 2017 for £70 million. Kier had completed a full redevelopment and extension of the building to create a total of 42,000 square feet of Grade A offices. As part of the purchase, Standard Life Investments secured a 25-year lease, with inflation linked rent reviews, to Kier Group which relocated its Kier Property office from Cavendish Place in January 2018. The building was originally built as a printing works in the 1920s.
Savills advised Abrdn.
Separately, Anthony Joshua, the former world heavyweight champion boxer, has completed the acquisition of of 73 New Bond Street and 12–16 Dering Street, W1 from Aviva Investors in a deal first tipped by CoStar News. The mixed-use building comprises 12,186 square feet of offices and retail accommodation and has sold for £25 million and a 2.96% net initial yield.
CBRE is advising Aviva on the sale. Michael Elliott advises Joshua.
Completion of the sales come as a number of bidding processes are under way in the West End, and a major City office investment has gone under offer, indicating a welcome improvement in activity.
Market sources said a European investor has gone under offer to buy Lion Plaza, American law firm White & Case's City of London headquarters, for close to the guide price of £262.7 million, the first time it will have changed hands in 17 years.
Cushman & Wakefield is advising on the sale of the building, with the guide price reflecting a net initial yield of 4.75% and a capital value of £992 per square feet.
The 264,967-square-foot office sits on an 1.4 acre site less than 100 metres from The Bank of England and The Royal Exchange. The property also includes retail, leisure and ancillary space with all of the offices on the firsts floor and above.
Savills reports that the West End saw £540 million of new availability with only 6% of this being "core plus" assets.
It reports nine separate bids processes in progress in March, including The Capital Portfolio, the six London-wide offices that Columbia Threadneedle has appointed JLL to sell, seeking £131 million or a 6.5% net initial yield. The others include ENI House, the Italian oil group's home at 10 Ebury Bridge Road, SW1, which Grosvenor is seeking to sell for around £60 million and 27 Soho Square, W1, which Federated Hermes is marketing for sale and market sources suggest is under offer for £45.5 million.
Also on the market are 55 Strand, WC2, the Covent Garden value-add opportunity which Legal & General is looking to sell, and Nobel House, the Department for Environment, Food and Rural Affairs at 17 Smith Square, SW1, for which M&G Real Estate is seeking around £55 million.