Acquisition of Bristol office tower

21 June 2011

Development Securities PLC and Ellandi LLP acquire £7.6m Bristol office tower

Development Securities PLC, the leading property development and investment company today announces that it has acquired Colston Tower, a multi-let office building in Bristol, in partnership with Ellandi LLP for £7.6m, reflecting a net initial yield of 10.08%. Under the terms of the partnership Development Securities will have a 75% ownership with Ellandi holding a 25% stake.

The building is a 15-story office tower with podium deck and is multi-let to 33 tenants with an occupancy rate of 85%. The property has a weighted average unexpired term of 4.1 years and there is significant scope to add value through intensive asset management and rolling refurbishment of vacant areas.

The building was acquired from HSBC Pension Fund, and completion was financed from equity, with a view to gearing in due course.

Matthew Weiner, Executive Director of Development Securities, said: "This latest acquisition continues our deployment of capital since July 2009 when Development Securities completed the first of its two recent £100 million equity raises. Colston Tower provides a high income return and significant scope to improve the property through intensive asset management."

Mark Robinson, partner of Ellandi LLP, added: "We are delighted to enter into our second joint venture with Development Securities following our successful acquisition of Crown Glass Shopping Centre in Nailsea 21 months ago."

Enquiries:

Michael Marx/Matthew Weiner

Development Securities PLC Tel: 020 7828 4777

Mallika Basu/Lucy Grimble

The Communication Group plc Tel: 020 7630 1411