The Regional Office Property Unit Trust, advised and managed by Schroder Real Estate, has acquired 1 East Parade and 8 St Paul’s Street in Leeds city centre from BMO for £12,700,000. The price reflects a net initial yield of 6.75% with a reversion to over 9% and a capital value of £188 per sq ft.
1 East Parade and 8 St Pauls Street are two adjoining multi let office buildings that total 48,500 sq ft and 19,000 sq ft respectively. 1 East Parade is built over ground and eight upper floors and is let to tenants including Zurich, Xalient and Appleyard Lees. 8 St Pauls Street is built over ground and five upper floors and is let to tenants including Caci Limited, IPS Group and Jones Myers LLP.
1 East Parade offers floorplates of 6,500 sq ft with a total of three floors vacant at present whilst 8 St Pauls Street offers floor plates of 2,500 sq ft with a two floors vacant.
Tom Newman, Investment manager at Schroder Real Estate said:
“This acquisition offers two good quality office buildings in a prime city centre location. We will reposition both buildings through a high quality refurbishment in a market that is seeing reducing levels of good quality office space.
This is the seventh acquisition for the Regional Office Property Unit Trust that is targeting assets offering good fundamentals in strong and undersupplied regional cities and towns. There is £150 million of funding available for immediate investment with target lot sizes of £5 to £25 million.”
Steadman Brierley acted for Schroder Real Estate and CBRE acted for the BMO.