Legal & General Property has invested £87.3m (€123m) in a Birmingham office asset for its UK Property Fund.

The No 1 Colmore Square building was bought at a net 4% initial yield for the fund, backed by institutional and retail investors.

The multi-let, 202,807 sq ft property is let to several tenants, including DTZ and Ernst & Young.

Matt Jarvis, fund manager of the Legal & General UK Property Fund, said the building offered “secure income over the medium term, coupled with good rental growth expectations”.

The building, he added, offers added-value opportunities, including refurbishment and letting of vacant space.

The deal follows the £69.5m purchase last month of the headquarters of UK beer brewer Mitchells & Butlers and a 120-bedroom Ibis Styles Hotel for the company’s LPI fund.