Tikehau Capital, a global asset management group with Best Star Real Estate Fedaia, has acquired the leasehold at 83-85 Pall Mall, London.

The Grade II listed, 45,000 sq ft building was bought from Railpen, the railways pensions scheme's investment manager.

Tikehau Capital and BSREF plan to convert it into a high-quality, energy-efficient office building with green certifications.

This marks Tikehau Capital's fourth UK acquisition and the first joint venture with BSREF. The transaction concludes Railpen's 15-year ownership, during which various value-enhancing initiatives were undertaken.

Frédéric Jariel, Co-head of Real Estate at Tikehau Capital commented: “We are pleased to acquire 83-85 Pall Mall which offers a rare opportunity of office repositioning in a supply-constrained market and prime location. As the occupier market continues to recover, we believe the demand for quality office space that can better accommodate evolving tenant needs will be stronger. On a relative basis, we believe that the central London office supply and demand dynamics and investment momentum offer an opportunity for capital value appreciation with attractive risk-adjusted returns.”

Carmen Alonso, Head of the United Kingdom and Iberia at Tikehau Capital said: "We are pleased to announce this investment in London, which represents a great addition to our existing real estate portfolio and, more importantly, demonstrates Tikehau Capital’s commitment to the UK real estate market and the office sub-segment in particular”.

BSREF’s George Adamopoulos and Pietro Stella said: “We are delighted to have partnered with Tikehau Capital for the acquisition of 83-85 Pall Mall. The property offers a rare opportunity to redevelop an iconic building in one of the most recognisable and prestigious office addresses globally. This acquisition further solidifies our track record and capability to pursue value-add opportunities in Central London. We look forward to working together to deliver on our repositioning plan for 83-85 Pall Mall.”

Advisers for the deal included Savills, DWF, CBRE, and Mills & Reeve.