M&G Real Estate has carried out a second large investment on London's South Bank in the space of three months.

M&G Real Estate has carried out a second large investment on London's South Bank in the space of three months.

The investor acquired the freehold interest of Riverside House on the south bank of the river Thames in London from Germany's IVG Immobilien for £122 mln (€146 mln), equating to a net initial yield of 5.74%.

The transaction was carried out on behalf of the M&G Property Portfolio, which is managed by Fiona Rowley and Justin Upton of M&G Real Estate.

The transaction comes about three months after M&G purchased Bankside 2 & 3 and the retail holdings of Bankside 1 in London's Southbank area from UK REIT Land Securities for £315 mln (€371 mln), representing an initial yield of 5.2%.

Riverside House comprises 15,793 m2 of grade A office, retail and ancillary accommodation over 14 floors in a prime Central London location. The office space is let to The Office of Communications (OFCOM), the UK regulatory body for the communications industry, on a full repairing and insuring release. The lease runs until September 2022 at a rent of £7 mln per annum. The retail units are let to The Real Greek, Zizzi Ristorante and EAT at a total rent of £401,000 per annum.

Robert Rankin, director at IVG UK, added: 'This sale realises the successful conclusion to our business plan for the property, having purchased the building for £106 mln in Q1 2005.'

M&G Real Estate was advised by GM Real Estate. CBRE and Knight Frank advised IVG (UK).