US private equity firm Blackstone has sold an office building in London’s West End at a yield of just 1.86%, in the latest evidence of the extent of yield compression in the prime office sector.
US private equity firm Blackstone has sold an office building in London’s West End at a yield of just 1.86%, in the latest evidence of the extent of yield compression in the prime office sector.
The property at 9 Clifford Street was acquired by a private European investor for £38 mln (€52.4 mln), exceeding the guide price of £35 mln set by Savills and Cushman & Wakefield.
The 1,245 m2 Grade II listed building is majority let to law firm Brown Rudnick until February 2022 at a total passing rent of £755,500 (€1.04 mln) a year. It was marketed as an opportunity to convert to a flagship West End retail store.
The 18th-century property was previously owned by Michael O’Flynn’s Tiger Developments. Blackstone bought the O’Flynn Group’s €1.8 bn debt for €1.1 bn from Ireland’s bad bank NAMA last year. It subsequently reached an agreement to sell 202 hectares of development sites in the UK and Ireland to O’Flynn, with Blackstone retaining the rest of the portfolio.
