West End of London Property Unit Trust (WELPUT), managed by Schroder Property, has exchanged contracts to buy the freehold interest in London's 101 New Cavendish Street at a price of £86.5 mln (€110 mln) in a private transaction.

West End of London Property Unit Trust (WELPUT), managed by Schroder Property, has exchanged contracts to buy the freehold interest in London's 101 New Cavendish Street at a price of £86.5 mln (€110 mln) in a private transaction.

The vendor is Greycoat Central London Office Development Fund.

The property comprises a 101,000 sq ft (9,400 m2) building extended and refurbished by Greycoat in 2009 with ground floor retail; four floors of offices and residential above, sold off on long leases. The average office passing rent is just £32.50 per sq ft. Occupiers include Tesco Stores, Post Office, University of Westminster and Dare.

'This is an opportunity to invest in a building with low passing rents and potential for strong growth,' commented Nigel Kempner of Grafton Advisors, strategic property adviser to WELPUT. 'The location is undergoing significant improvement led by major developments such as Fitzroy Place and also infrastructure and transport improvements, principally Cross Rail. The building will provide opportunities for future remodelling and improvement.'

Ian Mason of Schroder Property added: 'This acquisition is an important part of our strategy for WELPUT enabling us to recycle cash from the recent Point and Carey Street disposals into a location that we have identified as having great potential for growth.'

The vendors were represented by CBRE. The purchaser was represented by Allsop & Co and Strutt & Parker.

The purchase comes hard on the heels of WELPUT's sale last week of The Point office building located at Paddington Basin in London to Tishman Speyer for £210 mln (€284 mln).

WELPUT acquired a unit trust vehicle, the sole asset of which is the long leasehold interest in The Point, in 2004 in a joint venture with Hermes Real Estate. The building, which is situated directly opposite Paddington Station and adjacent to the Grand Union Canal, comprises 236,240 sq ft (just under 22,000 m2) of offices. It was designed by architect Terry Farrell and Partners and developed in 2003.

The Trust pursued a strategy of regearing and renegotiating leases culminating in the refurbishment and reletting of five floors where rents of up to £57 per sq ft were achieved last year.