Israeli pension funds acquire Croydon offices

Properties let to UK Borders Agency sold for £78m

Article posted: 10 Jan 2011

Office space in Croydon has been acquired by two Israeli pension funds for £78m, a net initial yield of a little under 7%.

Apollo House and Lunar House were formerly owned by Achilleas Kallakis’s Pacific Group of Companies that were bought by Green Property, and have now been purchased by joint venture Harel and Clal, the second UK acquisition for the pair.

The two properties total 440,000 sq ft of office space north of Croydon town centre and are fully let without breaks to the UK Borders Agency until 2023. Green Property acquired the buildings in 2009 and regeared the Apollo House lease which was due to expire in 2013, something which has proved significant since the government brought in a policy to exercise all lease breaks and expiries.

Harel has recently become active in the UK property market. It is Israel’s third-largest insurance group and last year formed a joint venture with fellow Israeli insurer Menora Mivtachim Holdings to purchase offices in Norwich. The property which was the former headquarters of Norwich Union was acquired for £134.4m from Telereal.

Posted by Anna