London & Stamford acquire City offices

One Carter Lane purchased for £75m

Article posted: 28 Apr 2011

London & Stamford Property has exchanged contracts, subject only to freeholder consent, with UBS Triton Property Fund to acquire One Carter Lane and Two Old Change Court for £75m.

The property occupies a prominent island site immediately to the south of St Paul's Cathedral. It is long leasehold with a further 136 years unexpired and comprises 125,844 sq ft of office space in the City of London and 6,810 sq ft of retail accommodation.

The current net income is £5.814m per annum, 97% of which is from Goldman Sachs International expiring in 2018. The Goldman lease has a tenant break clause in March 2013.

The transaction reflects a net initial yield of 7.33% and, initially, will be financed out of existing cash resources. Leverage may be sought following completion to enhance the cash yield further.

Raymond Mould, Chairman of London & Stamford Property, said: "Central London continues to show signs of economic growth and we are delighted to have acquired this prime, City of London property producing a relatively high net initial yield reflective of the nature of the investment. The transaction also represents an excellent asset management and/or refurbishment opportunity at a time when there is forecast to be a shortage of good quality buildings during a period of strong rental growth in the City." 

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Posted by Sara