Madison buys into €250m Houndsditch Estate in London

New York-based investor Madison International Realty has acquired a 50% stake in The Houndsditch Estate in the City of London from TIAA Henderson Real Estate (TH Real Estate) on behalf of its Central London Office Fund.

The deal forms the basis of a new joint venture partnership between the two firms.

With a total value of £200 mln (€250 mln), the 30,400 m2 portfolio comprises five properties - Cutlers Court (115-116 Houndsditch), 117-119 Houndsditch, 120 Houndsditch, Cutlers Exchange (123 Houndsditch) and 133 Houndsditch - situated on a 1.75-acre freehold island site in the City of London.

The site was acquired in two stages during 2006 and 2009 by TH Real Estate including the freehold interest of half of the estate from the Cutler’s Company late last year.

Currently 95% let, the estate is located in the Square Mile and is set to benefit from its close proximity to the major transport hub of Liverpool Street, where a new Crossrail terminus will be added in 2017 to the existing rail, underground and bus stations.

TH Real Estate currently manages around £1.5 bn of London offices, comprising over 30 properties across its main sub-markets. Following the Houndsditch transaction, the company will become 50:50 joint partners with Madison for the entirety of the portfolio. TH Real Estate will continue to manage the portfolio on behalf of the JV.

Commenting on the acquisition, Derek Jacobson, managing director at Madison International Realty, said: 'This transaction is directly in line with our investment strategy of acquiring ownership stakes in core, quality real estate located in prime locations through the injection of equity into existing joint venture and partnership structures.'

Nick Deacon, director of Central London Offices at TH Real Estate, added: 'The creation of this joint venture with Madison is consistent with our strategy to enter into joint ventures alongside partners across a range of sectors.'