Middle Eastern investors buy up prime real estate on London’s Southbank
The deal also includes an adjoining 10,690 square foot retail and residential building known as Cubitt House.
Middle Eastern investors are buying up a 20-storey commercial building on London’s Southbank for £266.5 million in a sign that international interest in UK prime real estate is still going strong.
Wolfe Asset Management Limited – which is owned by Dubai’s Al Gurg family – has exchanged contracts to buy the three-year old building at 240 Blackfriars Road from the Great Ropemaker Partnership (GRP), which is a joint venture between Great Portland Estates and Ropemaker Properties.
The 226,271 square foot site was constructed in 2014 and is currently let to seven office tenants including UBM, Boodle Hatfield, Ramboll and Lonely Planet Publications, who pay rents ranging from £47 to £65 per square foot.
The building also hosts retail tenants including Pret a Manger and Abokado.
The deal includes an adjoining 10,690 square foot retail and residential building known as Cubitt House, where ten apartments have been sold on long leases.
In total, rental income for the site is about £11.2 million per year.
The deal is set to be completed in January.
Abdulla Al Gurg, group general manager of Wolf Asset Management, said: “The 240 Blackfriars Road building is iconic in its design and an instantly-recognisable feature of the London skyline.
“It perfectly fits within our strategy of owning best-in-class commercial buildings in prominent London locations.
“Southbank is regarded as one of London’s most vibrant districts and thriving sub-markets, with a unique combination of world-renowned arts and theatre institutions, hotels, luxury residential developments, excellent connectivity and prime real estate.”
It is the latest in a recent string of property deals struck by international investors in recent weeks.
Chinese investment group Hengli Investments Holding Group signed a 20-year lease on a property at 25 Gresham Street in London earlier this month that has served as Lloyds Banking Group’s headquarters since it was constructed.
The financial terms of the deal were not disclosed.
It followed news that Cheung Kei Group forked out £270 million for a Canary Wharf tower that is currently let to businesses including US banking giant JP Morgan, which rents 10 floors, as well as Time Inc, American Express, Balfour Beatty and Cision Gorkana.
The company bought the site – at Five Churchill Place – from Said holdings.
Earlier this year, Hong Kong food conglomerate Lee Kum Kee spent £1.3 billion buying out Canary Wharf Group’s and Land Securities’s 50% stakes in the “Walkie Talkie” skyscraper in June.
London’s landmark “Cheesegrater” building was also sold in March to the investment vehicle of Chinese property magnate Cheung Chung Kiu for £1.15 billion.
Commenting on the sale of 240 Blackfriars Road, Great Portland Estates chief executive Toby Courtauld said: “The sale of 240 Blackfriars Road is the culmination of an exceptional development project for GRP.
“Having secured an attractive planning permission in March 2011, GRP commenced development in January 2012 following the pre-letting of 105,825 sq ft to UBM Plc.
“The sale continues our strategy of recycling capital out of assets where we have created value”.