Helical plc has sold The Shepherds Building in West London to Workspace Group PLC for £125.3m (£835 psf), representing a net initial yield of 4.8% rising to 5.1% on expiry of rent frees.
The sale represents a 12.4% premium to 31 March 2018 book value.
The sale will allow Helical to recycle capital into new value-add and development opportunities, in pursuit of continued enhanced returns for shareholders.
Helical is now focusing on high quality, design led office and mixed-use schemes in London and Manchester. The Shepherds Building is a former Inland Revenue tax office on Rockley Road, London W14, and was acquired by Helical for £12.8m in 2000. This purchase was followed by a full refurbishment of the property and the addition of an extra floor. A further overhaul of the common parts was undertaken and a new entrance area was built in 2014. The 150,000 sq ft building has eight floors and is 99% let to 32 different occupiers with an average contracted rent of £45.60 psf. The disposal is expected to complete next month.
Gerald Kaye, Chief Executive of Helical, said:
“We have enjoyed 18 strong years of ownership at The Shepherds Building. We took the decision to dispose of the asset as it will allow us to recycle our equity into new projects to create future profits.”