FTSE250 commercial property investors snap up £20m offices
UK Commercial Property Trust (UKCPT), a FTSE250 commercial property investor, has bought a Sheffield city centre office for £20m.
The 61,638 sq ft Hartshead House on Cutlers Gate is let to Capita Business Services Limited, which is part of Capita plc, on a lease with 22 years to expiry with an annual rent of just over £1m a year.
UKCPT said that the current availability of Grade A office space in Sheffield is limited, with a projection of less than five months’ supply in the market, making Hartshead House a desirable asset.
Geurnsey-based UKCPT is advised by Standard Life Investments, and owns a diversified portfolio of UK commercial property. It raised £530m when it debuted on the stock market in 2006, and since then has been growing its portfolio with the proceeds.
The acquisition of the site returned a net initial yield of 5%.
Will Fulton, fund manager at Standard Life Investments, said: “We have undertaken a significant amount of asset management activity during the course of 2017 and our strong focus throughout has been on further improving the income profile of our portfolio.
“To this end, the new asset in Sheffield meets our current preference for long term, secure and growing rents, while at the same time further enhancing our dividend cover.”
Together with the purchase in February of a pre-let distribution warehouse development in Burton upon Trent, the two acquisitions, at a combined £42.4m, deliver a blended yield of 5.4%.
