Acting on behalf of the Indian real estate developer ABIL Group, Savills has acquired 5 Strand from BlackRock UK Property Fund, for more than £90 million.
The acquisition is the developer’s first investment in the UK.
The 72,359 sq ft (6,722 sq m) office and retail building is currently let to Westminster City Council and Boots. The property was marketed with plans designed by Adjaye Associates for a 200-room hotel scheme along with planning consent for a new 152,400 sq ft (14,158 sq m) development including 61,670 sq ft (5,729 sq m) of office accommodation, 5,376 sq ft (499 sq m) of retail space and 38,941 sq ft (3,617 sq m) of luxury residential accommodation.
Barry Mangan, director in the central London investment team at Savills, commented: “Located adjacent to Trafalgar Square, close to Charing Cross station, 5 Strand presents an attractive redevelopment opportunity to maximise the building’s strong position in prime central London. As such it makes a good investment for our client, in their first UK purchase.”
Gary Witham, director in the hotels team at a Savills, said: “The London hotel market continues to attract a wide range of overseas investors with the city providing attractive long term income prospects. As the first purchase for our client, 5 Strand makes an excellent choice providing the opportunity to create a leading purpose built hotel l in a tourist location that is recognisable to a global audience.”
Data from Savills shows that overseas investment into hotels in London totalled £1.06 billion last year, an increase of 17.7% on 2016. Institutional capital investment into hotels also grew 6.8% to £370.7 million in 2017, the highest level of investment from this buyer type for over 10 years, according to the firm.
Cushman & Wakefield, together with Tudor Toone, advised BlackRock on the sale.