Private equity real estate company Evans Randall Investors has launched the sale of the Sovereign House data centre in London for an asking price of over £39 mln (€44 mln), reflecting a 5% net initial yield (NIY).
Located at Marsh Wall, opposite the Canary Wharf and Wood Wharf estates in London’s Docklands, Sovereign House was constructed as a high-quality office and following substantial tenant investment now operates as a data centre.
The development occupies a virtual freehold island site, and offers over 72,000 sq ft (6,700 m2) of flexible commercial space extending over basement, ground and five upper floors.
The building is securely let for in excess of eight years to Digital London, a wholly-owned subsidiary of Digital Realty Trust, one of the largest publicly traded US REITs. The property has an overall passing rent of nearly £2 mln a year, reflecting a low £27.25 per sq ft overall.
'Sovereign House offers a very secure income stream guaranteed by an investment grade covenant alongside some very interesting medium and longer term asset management and development opportunities,' said Paul Kendrick, CIO of Evans Randall Investors.
He added: 'The surrounding area is witnessing significant redevelopment and improvements to the local amenities with numerous major office, residential and mixed-use schemes continuing to enhance the surrounding landscape and connectivity; not least the new Elizabeth Line station at Canary Wharf. We think the excellent income profile and asset fundamentals will see strong investor interest.'
CBRE is advising Evans Randall Investors.
