3rd Oct 2018 08:14
LONDON (Alliance News) - Great Portland Estates PLC on Wednesday said it has sold its 55 Wells Street development in London for GBP65.5 million.
In a separate statement, the company also said it has signed 24 new lettings in its most recent quarter.
Great Portland has exchanged contracts for the office block with an unnamed overseas investor. After tenant incentives and vendor top-ups, Great Portland expects to receive GBP64.6 million from the sale.
The headline GBP65.5 million price equates to a net initial yield of 4.0% and a capital value of GBP1,674 per square foot of the office accommodation, which is comprised of six upper floors, a ground floor restaurant, and a lower ground floor.
The offices are let to Williams Lea Ltd and Synova Capital, and have a total yearly income of GBP2.8 million.
"The sale of 55 Wells Street crystallises another successful development for Great Portland, and is consistent with our strategy of recycling capital out of mature assets," said Chief Executive Toby Courtauld.
In its quarter ended September 30, the property developer signed 24 new lettings, securing GBP5.3 million in combined annual rent - of which its own rental share is GBP4.4 million.
Seven rent reviews were settled for GBP2.4 million during the quarter, of which Great Portland's share was GBP2.3 million, 16% above the previous rent and 3.2% ahead of estimated rental value.
Since the start of its financial year, the company has signed 135,400 square feet of new lettings, generating annual rent of GBP8.1 million, of which its share was GBP6.3 million, with market lettings 4.8% above its March estimated rental value.
Post quarter end, the company had a further 38,600 square foot under offer for a combined GBP1.7 million of rent, 1.8% ahead of its estimated retail value.
"We are pleased to report another quarter of positive leasing activity. We continue to see sustained occupier demand for our high quality space, leasing ahead of the valuer's estimated rental value and capturing portfolio reversion," said Courtauld.
Shares in Great Portland were broadly flat at 665.30 pence early on Wednesday.
Related Shares:
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