REAL ESTATE – The £1.6bn (€2.6bn) Nottinghamshire County Council Pension Fund has bought an office building in the southern English town of Sutton for £13.33m.

The 55,000 sq ft Chancery House was sold by property investment and development firm McKay Securities PLC to Arlington Property Investors, who acted on behalf of the local authority fund. It was sold in excess of book values, representing an initial yield of 6%.

The fund bought the property last week, a member of the fund’s investment team said. It is the latest move in the fund’s increasing UK and European real estate investments, though in continental Europe we only invest in real estate via unit trust, the person said.

Arlington, which advises various local authority pension funds, assists the Nottinghamshire pension fund with all its UK real estate investments, the fund said.

Chancery House was built in partnership with unit trust managers Hill Samuel, by McKay in 1982. Two years ago the company acquired the controlling 80% head lease interest for £4m and, after refurbishment, “achieved full occupation of lettings totalling 24,000 sq ft,” according to McKay.

McKay’s managing director Simon Perkins said the proceeds from the sale “will be used for acquisitions and new development and refurbishment projects within our existing portfolio”.