28th Aug 2018 12:08
LONDON (Alliance News) - Town Centre Securities PLC on Tuesday said it has acquired The Cube in Leeds for GBP12 million.
The acquisition from Aviva is set to be completed October 1 and will be funded through the property developer's existing resource and planned disposals.
The company said its re-financing of Merrion House, also in Leeds, in July had given it "considerably greater financial flexibility".
The Cube, on 123 Albion Street, is near to Merrion House and comprises of 22,000 square feet of ground floor leisure units with leases to Hard Rock Cafe and Mecca Bingo with 50,000 square feet of offices over three floors let to Capita PLC and the UK government.
The building also has a freehold for 84 apartments which are leased to Persimmon Homes at a "peppercorn rent".
The purchase represents an initial yield of over 12.5% on the passing income. Lease expiries in 2019 and 2020 will reduce the yield to around 9%.
Chairman and Chief Executive Edward Ziff said: "The Cube represents a strategic acquisition for Town Centre Securities, as we further expand our ownership in Leeds, with its proximity to the Merrion and other key destinations in the city centre. It will provide us with asset management opportunities and importantly the additional income will help mitigate the effect of further asset sales that we plan from our portfolio.
"This transaction demonstrates our ambitious growth plans, and the momentum that we are building with both our exciting development pipeline and strategic acquisitions such as The Cube and Ducie House, in our Piccadilly Basin development."
Shares in Town Centre Securities were up slightly at 274.11 pence each Tuesday.
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