Birmingham property investment boom continues as two more office buildings sold
INVESTOR interest in central Birmingham office stock shows no sign of abating as two more buildings are sold.
Lancaster House, on the corner of Newhall Street and Great Charles Street has been acquired by property investment vehicle Custodian REIT for £6.65m while 63 Temple Row has been bought by EPIC (UK) for £11.6m.
Lancaster House is a 39,600 sq ft office building in a prominent corner position facing towards the city’s central business district, which is on the other side of Great Charles Street. Occupiers include property consultancy KWB and developer Stoford.
The property is let to 15 tenants with lease expiries between 30 June 2016 and 31 July 2025 with a total passing rent of £505,752 per annum, reflecting a net initial yield of 7.19%.
Richard Shepherd-Cross, managing director of Custodian Capital (Custodian REIT’s discretionary investment manager), said: “We are delighted to have secured this recently refurbished office building in Birmingham city centre where the office market is resurgent and prospects for rental growth strong.
“The property offers open-plan, 2,000-3,350 sq ft office suites which are a good fit with local occupational demand. This, combined with reducing supply, as a result of a number of nearby buildings being converted to residential use, could further compound rental growth prospects.”
Meanwhile, clients of Aberdeen Asset Management have sold 63 Temple Row to EPIC (UK).
The ten storey, 39,515 sq ft multi-let office building, which is home to Allied Irish Bank and law firm BLM, is leased at an average office rental of £17.60 per sq ft, reflecting a net initial yield of 5.67%.
GBR Phoenix Beard advised the clients of Aberdeen Asset Management, while EPIC (UK) was advised by Farmer Capital.
