Great Portland Estates plc (“GPE”) announces the acquisition of the head leasehold interests in French Railways House and 50 Jermyn Street, SW1, for £39.0 million from Henderson Global Investor’s Central London Office Fund 1 (“CLOF 1”). The purchase price reflects a net initial yield of 5.1% and a capital value of £782 per sq. ft.
The properties were both built in the 1950’s and provide 49,879 sq. ft. of office and retail accommodation on an underdeveloped 0.3 acre site. They are multi-let to 9 occupiers producing a gross rent of £2.12 million per annum, which reflects an average rent of £46.50 per sq. ft. on the offices and £125 per sq. ft. Zone A on the retail, offering good short term reversionary potential; all of the leases have events between 2012 and 2014. The properties are held leasehold from The Crown Estate (“TCE”), expiring in 2057 and 2053, respectively, with a total fixed ground rent of £13,250 per annum. They adjoin the Piccadilly Estate, a 130,000 sq. ft. office and retail holding owned by the Great Capital Partnership (”GCP”), GPE’s 50:50 Partnership with Capital and Counties Properties PLC.