Schroder Real Estate sells Victory House in Brighton – Schroder Real Estate Investment Trust has exchanged unconditional contracts to sell Victory House in Brighton to an institutional purchaser for GBP36.1 million. The disposal is scheduled to complete on 30 April 2019.
Victory House is an 84,988 sq ft office building in Brighton city centre, let to BUPA Insurance Services Limited and Mott MacDonald Limited with an average weighted unexpired lease term of 7.7 years. The current rent is GBP0.79 million per annum, increasing to GBP1.88 million per annum in September 2019 on expiry of a rent free period. The price therefore reflects a net initial yield, on
expiry of the rent free period in September 2019, of 4.9%.
As at 31 December 2018 Victory House was valued at GBP34.25 million. Based on the disposal price, the asset has generated an ungeared total return of 10.3% per annum since acquisition in 2005, compared with the MSCI Benchmark for the same period of 5.9% per annum.
After this deal and the sale of the Wickes retail warehouse in Basingstoke announced on 7 March 2019, and based on the independent portfolio valuation as at 31 December 2018, the company’s consolidated net loan to value will fall from 27% to 21%.
The additional cash, reduced loan to value and undrawn revolving credit facility provides Schroder Real Estate with the flexibility to monitor the market and consider new investment opportunities in the future.
SREI : Schroder Real Estate sells Victory House in Brighton