Hammerson plc has sold the freehold of 60 Threadneedle Street, London EC2, to St. Martins Property Investments Limited, the UK-based real estate investment vehicle of the State of Kuwait.
The net consideration after deducting rental top-ups is £176 million, £5 million of which is deferred subject to certain conditions which are expected to be satisfied by 2013. The last valuation at 30 June 2011 was £165 million. Passing rents, post rent-free periods, are £8.8 million and the price represents an initial yield to the purchaser of approximately 4.75%.
Completed by Hammerson in January 2009 at a cost of £124 million, the 19,900m2 (214,200ft2) building is in the centre of the City of London, and forms part of the site previously occupied by the London Stock Exchange. It provides nine storeys of office accommodation with tenants including Talbot Underwriting, Universities Superannuation Scheme, Berenberg Bank and The Toronto Dominion Bank.
Hammerson was advised by Strutt & Parker and Nabarro, with St. Martins Property Investments Limited advised by Savills and Eversheds.
David Atkins, Chief Executive of Hammerson, commented:
“We have a clear strategy for London offices of creating high quality property through asset management and development, then recycling capital to realise value. This disposal will allow Hammerson to crystallise significant development profits and further enhance our financial flexibility for future refurbishment, development and acquisition opportunities.
Having originally acquired the former Stock Exchange site in 2002, and progressed two separate developments, we generated significant value through the sale of 50% of 125 Old Broad Street in 2006, and have now realised a substantial profit on cost from the sale of 60 Threadneedle Street.”