M&G Investments has backed a Goldman Sachs and Greycoat joint venture with a  £69.1m (€78.5m) loan to help refurbish a central London office asset.

M&G Investments said part of the 3-year loan, which was provided on behalf of its funds, will cover the refinancing costs of acquiring the Procession House asset, with the remainder financing the refurbishment works.

The refurbishment is expected to complete early 2020.

Legal & General’s investment management’s real asset division sold the asset in July last year for £69m. 

Procession House comprises over 100,000sqft of office and retail space on top of the City Thameslink station.

Dan Riches, director in the real estate finance team at M&G Investments, said: “We continue to see strong demand for central London office space and this property will provide sought-after, high-quality offices for businesses in a desirable location, with great connectivity and local amenities.

“The strong sponsorship and combination of institutional capital, a best in class operating partner and experienced project team, along with strong underlying fundamentals in this submarket made Procession House a compelling lending opportunity.”

Riches said following an active 2018 during which M&G committed to over £1.2bn of investments across Europe, the company’s institutional investors continue to seek exposure to commercial real estate debt in order to achieve attractive risk-adjusted returns.

“The UK, and in particular, London, continues to offer strong relative value and we continue to see a considerable pipeline of opportunities in this space”.