Midtown office building acquired for £82.7m

GI Partners & Rowan Asset Management purchase Aldwych House

Article posted: 19 Dec 2011

GI Partners, a leading private investment firm, in partnership with Rowan Asset Management, has announced the £82.7m freehold acquisition of Aldwych House, a building comprising 163,000 sq ft of office space in London’s Midtown. The transaction was funded by capital from GI Partners Fund III L.P. with investments coming from Rowan and Taurus Investment Holdings, LLC and debt finance provided by Nationwide Building Society.

Aldwych House, built in 1926 and last renovated in 1988, is currently 89% let to 11 tenants over ten floors. Existing tenants include Associated British Ports, the London School of Economics and Manches, the solicitors. Rowan will act as asset manager and will oversee a major refurbishment of the building, repositioning Aldwych House in the marketplace. This undertaking will create a rebranded offering, with an iconic modern entrance and common areas, materially improving the environment for occupiers.

Brad Altberger, Managing Director of GI Partners, commented: “Aldwych House is an excellent opportunity for us to invest in a high quality asset in the central London office market. Purchasing Aldwych House at just over £500 per sq ft, we think the downside is well protected. In addition, we believe there is potential for significant upside as the building is let at below market rents. GI Partners is also actively seeking similar acquisition targets which require intensive asset management and we have a significant amount of dry powder in our $1.9bn Fund III to execute this strategy.”

Nick Jacobs, Founder and Chief Executive Officer of Rowan Asset Management said: “Aldwych House is a classic ‘Rowan asset’ which will provide our capital partners with both income and opportunity. We are thrilled to have bought a product which will benefit from an occupier-sensitive but extensive re-branding and refurbishment. The building is located in a key area of the London market in which we have great confidence. We think Midtown is going to see strong rental growth and is becoming a primary occupier destination. At the micro level there are considerable initiatives in the subsectors of Aldwych and The Strand which should further enhance this location.”

Fineman Ross acted for the purchaser while Strutt and Parker acted for the vendor.

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Posted by Sara