Union acquires Manchester office project in off-market deal

Germany's Union Investment has purchased the XYZ Building development in Manchester in a forward funding and off-market transaction from developer Allied London Properties.

Financial details were not disclosed.

The asset, which is due to complete in August 2016, was bought for Union's UniInstitutional European Real Estate open-ended real estate fund.

Located in the heart of the city centre, the property will provide some 14,583 m2 of office accommodation arranged over basement, ground and eight upper floors. Three months before completion, 95% of the building is pre-let to six different tenants including NCC, Smoosmiths and Global Radio.

'This acquisition underlines our successful regional market strategy we defined to invest into the UK secondary cities showing growth and outperformance,' said Martin Brühl, a member of the management board at Union Investment Real Estate.

This is the second investment ever made by Union Investment in Manchester, following the acquisition of the Radisson Blu hotel at Manchester airport in 2004.

'Having entered the UK office market in 1992, we have steadily developed our real estate portfolio in London as well as in the regional markets such as Manchester, Birmingham or Cardiff. And we are continuing to actively exploit opportunities in the UK real estate markets in 2016,' commented Brühl.