UK fund manager Tritax has launched the Tritax Aberdeen Office Fund, enabling private investors to participate in a new 3,700 m2 office development in Aberdeen.
UK fund manager Tritax has launched the Tritax Aberdeen Office Fund, enabling private investors to participate in a new 3,700 m2 office development in Aberdeen.
The development has been pre-let on a 15-year lease to GDF Suez E&P UK, a subsidiary of the utility group. The lease contains a mechanism to hedge the investor against inflation, in the form of five yearly rent reviews providing guaranteed increases in income.
The fund has a targeted total return (IRR) of 9.5% per annum and capital allowances provide further value for UK tax payers, enhancing the pre-tax total return to 13% plus per annum.
'Against the prospect of higher levels of inflation and continued uncertainty in the UK economy, investors are continuing to turn to prime property as an investment option thanks to its ability to deliver stable, predictable and increasing income streams,' said Colin Godfrey, partner at Tritax.
He added: 'With a modest amount of gearing this opportunity is providing income of an annual 7.5%, which against the backdrop of record low bond yields is highly attractive.'
