The Great Ropemaker Partnership, a 50:50 joint venture between Great Portland Estates and the BP Pension Fund is set to acquire two office buildings on 200 & 214 Gray's Inn Road in London from an affiliate of Beacon Capital for £132.75 mln (EUR 155 mln), or an initial yield of 6.4%. The deal is expected to be completed by 18 October.
The Great Ropemaker Partnership, a 50:50 joint venture between Great Portland Estates and the BP Pension Fund is set to acquire two office buildings on 200 & 214 Gray's Inn Road in London from an affiliate of Beacon Capital for £132.75 mln (EUR 155 mln), or an initial yield of 6.4%. The deal is expected to be completed by 18 October.
The 10-storey 246,500 sq. ft (22,900 m2) property on 200 Gray's Inn Road is held virtual freehold and is leased to four tenants including Carlton Communications Ltd and ITN at £8.42 mln per annum. The leases expire between 2017 and 2023, with significant rent reviews in 2011 and 2013, and a weighted average unexpired lease term of 6.8 years.
The other asset comprises 45,500 sq. ft. of predominately car parking and back up accommodation for 200 Gray's Inn Road and is mainly let to ITN until 2023 at a rent of £500,000 per annum. It is held long leasehold expiring June 2174 at a peppercorn rent.
Ben Chambers, GPE Investment Director said the property had been acquired at a price 'significantly beneath our estimate of its replacement cost' and that there were opportunities to add significant value through active management. 'Furthermore, it is in an area we expect to benefit in the medium term from the impact of the Crossrail and Thameslink projects at Farringdon, and the continued development activity around King's Cross and St Pancras.'
