UK property company Hermes Real Estate has exchanged contracts for the sale of the freehold interest in 3/5 Burlington Gardens, London W1, to UK and US-based property company EPIC for over £75mln (EUR 95mln). The deal - reflecting a net initial yield of just over 4% - follows Hermes' successful sale of another Mayfair office building, 7 Clifford Street, in April this year. The 3,800 m[sup]2[/sup] building was sold to a private overseas client of GVA Saxon Law for about £70mln (EUR 89mln), which equates to a net initial yield of less than 4%.
UK property company Hermes Real Estate has exchanged contracts for the sale of the freehold interest in 3/5 Burlington Gardens, London W1, to UK and US-based property company EPIC for over £75mln (EUR 95mln). The deal - reflecting a net initial yield of just over 4% - follows Hermes' successful sale of another Mayfair office building, 7 Clifford Street, in April this year. The 3,800 m2 building was sold to a private overseas client of GVA Saxon Law for about £70mln (EUR 89mln), which equates to a net initial yield of less than 4%.
The 3/5 Burlington Gardens property provides 4,162 m2 of Grade A office accommodation leased to Heidrick & Struggles and Riverstone Private Equity with office rents ranging between £56 and in excess of £100 per sq ft. Cecconi's Restaurant occupies the ground and basement on a long lease. 'Having secured a headline rent in excess of £100 per square foot Hermes decided to sell Burlington Gardens,' said Tim Turnbull, director at Hermes RE.
'In 2004 Hermes recognised the volatility of the Central London Market but also noted that if played correctly it offered the best returns in the commercial sector over an upswing in the commercial market cycle. Consequently in 2004, believing that this was close to the bottom of the cycle, Hermes conceived a plan to increase its core assets as soon as possible with the aim of selling around 2008.
Hermes was advised by Jones Lang LaSalle in both sales. Franc Warwick acted for EPIC.
Additionally, Hermes RE said that Ben Sanderson is to join the company as director of International Investment in September. Ben has worked in international real estate for more than ten years and is currently a director of Fund Management at Prupim, where he was the Fund Manager of the M&G Global Real Estate Securities Fund.
