£10m city centre property deal completes

THE deal to buy Bank House in Leeds for £10m was completed yesterday.

Palace Capital, which specialises in property investments outside London, has bought Bank House, on King Street, from a major pension fund for £10m cash.

The 90,000 sq ft property, built in 1968 for the Bank of England, still houses its original occupiers on the bottom two floors, with law firm Walker Morris and Axa Insurance also current tenants. There is currently 8,800 sq ft of vacant space, which represents about 10% of the total space available.

Bank House produces a net income of £864,000 a year, representing a net yield of 8.1% after transaction costs which Palace Capital believes can increase to “around 10%” through active management.

Last August Palace Capital raised £20m with investors which enabled it to acquire Property Investment Holdings (PIH) and be ready to make acquisitions of suitable properties as the opportunites arose.

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