Ho Bee Land Limited has acquired its second prime asset in West End London within a week. Its wholly owned subsidiary, HB Mayfair Pte. Ltd. HBMPL has entered into a sale and purchase agreement with Aberdeen Asset Management to acquire the office known as 110 Park Street.
The Property is acquired for recurrent income and will be held as a long term investment. The gross purchase consideration for the Property is £45.8 million which was arrived on a willing-seller and willing-buyer basis. After accounting for rental guarantee and rent top ups, the nett price payable is about £44.6 million . A 10% cash deposit has been paid and the balance will be payable in cash on completion which is scheduled in end August 2015.
The Property is held leasehold from Grosvenor West End Properties for a term of 125 years expiring in June 2121 (balance term of 106 years). It is multi-let and has a Weighted Average Unexpired Lease Term of 8.68 years to lease expiry and 5.40 years to tenant break options.
The total gross annual passing rent is at £2,099,498 per annum, reflecting an average rent of £77.77 per square foot. After deducting the current head rent of £82,933 per annum, the net passing rent is at £2,016,565 per annum. This rent is highly reversionary. The nett initial yield is c. 4.5% based on net purchase price.