Schroder Real Estate buys office property in Edinburgh and Nottingham – Schroder Real Estate (SREI) has announced the acquisition of two office developments in Edinburgh and Nottingham. The acquisitions are due to complete on 10 August .
The combined price for the two properties of £21.0m reflects a net initial yield of 6.7% and a reversionary yield, based on the independent valuers’ view of the rental value, of 7.6%.
The acquisitions will be funded using existing cash and the RBS revolving credit facility.
The properties are:
Edinburgh, The Tun
- 43,500 sq ft office heritable interest (Scottish equivalent of a freehold) located in the Holyrood district of Edinburgh
- Let to nine tenants including the BBC Scotland, the European Parliament, the General Medical Council and Cloudreach Europe at an average office rent of £18.00 per sq ft
- Average unexpired lease term of 5.6 years to lease expiry and 3.5 years assuming all tenants break at the earliest opportunity
Nottingham, The Arc
- 45,200 sq ft freehold office located on a business park in Nottingham that is adjacent to a tram stop that provides a regular, six minute service to the city centre
- Let to four tenants namely HSBC bank plc, Geldards LLP, CIS General Insurance Limited and Ryley Wealth Management with an average office rent of £17.90 per sq ft
- Average unexpired lease term of 5.4 years to lease expiry and 2.3 years assuming all tenants break at the earliest opportunity, with negotiations ongoing that if completed will increase the average lease term
On completion of the acquisitions, and incorporating the impact of new refinancing arrangements, Schroder Real Estate’s net loan-to-value will be approximately 29%, comfortably within the it’s target range of 25% to 35%.
SREI : Schroder Real Estate buys office property in Edinburgh and Nottingham