Great Portland buys an acre of Whitechapel – Great Portland Estates plc has acquired the freehold of land and buildings including Cityside and Challenger House, 40/42 Adler Street and 2/8 Whitechapel Road, London E1 from Hermes Investment Management, for GBP49.6 million (GBP320 per sq ft).
The 1.1 acre site sits between Aldgate to the west and the new Whitechapel Crossrail Station to the east and is made up of;
- Cityside House -The freehold interest in a five-storey, 54,300 sq ft office building. The property is currently unoccupied and has planning consent for an additional three floors, taking the total net internal area to 76,500 sq ft, reflecting a capital value of GBP250 per sq ft*. GPE expects to complete major refurbishment works during the second half of 2019, targeting average rents across the building of GBP47 per sq ft.
- Challenger House -The freehold interest in a five-storey hotel, leased to Qbic Hotels for a further 21 years at a rent of GBP1,400,000 p.a., with CPI linked five yearly reviews, capped and collared at 2% – 4% p.a.. The hotel trades from 171 bedrooms with a public restaurant.
- Development sites – Freehold land to the rear of Cityside House, part of which has a planning consent for 19,000 sq ft of development, comprising hotel and residential uses. GPE will seek to improve the existing consent to deliver more beneficial and value creating uses for the land including amenity space for the occupiers of Cityside House.
Robin Matthews, Investment Director at GPE, said: “This acquisition represents an exciting opportunity for us to develop a well-designed, cost effective and prominent office building in the heart of Whitechapel, supported by a long-term income stream from Qbic Hotels, and further development sites. In addition, Whitechapel is set to benefit from significant further regeneration, including its new Crossrail station opening in late 2018.”
Chris Taylor, Head of Private Markets at Hermes Investment Management, said: “The sale of 40/42 Adler Street and 2/8 Whitechapel Road is an excellent result for the Fund. We are now able to redeploy capital into new acquisitions where we believe additional value can be added.”
GPOR : Great Portland buys an acre of Whitechapel