UK - Hermes Real Estate, the wholly owned property fund management arm of the BT pension fund, has put the Tower 42 office building in the City of London on the market for £300m (€342m).
Hermes and BlackRock's UK Property Fund, which both co-own the building, made the decision to sell the trophy asset, along with a number of neighbouring buildings, as part of a move to reposition their portfolios.
Chris Darroch, a director at Hermes, said: "With significant global investor demand now focused upon central London offices - driven by expectation of future returns, combined with a dearth of trophy assets on the market and weak sterling - the partnership believes that timing is right to market the asset in order to reposition their portfolios.
"This is a liquid investment within Central London with growth prospects considered to be exceptionally strong," he added.
Hermes expects the City of London office market to perform strongly this year, citing forecasts of 21% for 2010 and 12.3% over the next five years.
"These returns are being driven by an increased weight of foreign and local capital targeting the sector, following a significant fall in values between mid-2007 and mid-2009, combined with a resurgent financial services industry," said Darroch.
Tower 42, at more than 600ft in height, is the tallest occupied building in the City of London.
In addition to the iconic 324,000 square foot multi-let Tower 42, the estate includes five other commercial buildings on the 2.2 acre freehold site.
Hermes and BlackRock said the estate is currently 95% let and continues to attract tenants from a diverse occupier base whilst achieving market-leading rents.
The owners will be seeking offers in excess of £300m for the estate, reflecting a net initial yield in the order of 6.5%.
"We believe that these opportunities make Tower 42 a very interesting proposition for an investor who is looking to make their mark on the City landscape," Darroch said.
"There is currently strong global interest in trophy assets in Central London which should enable us to secure some interesting proposals for the Tower 42 Estate."
Marcus Sperber, managing director at BlackRock, said: "This represents a unique opportunity to acquire a substantial freehold estate and renowned tower office building in a prime location in the City of London.
"The estate offers a significant number of exciting asset management and value add initiatives, including redevelopment potential and short-term leasing opportunities, at a time when rents in the City market are clearly on an upward trend."