Squarestone Growth, a high yielding regional fund, has successfully repositioned Central Park in Leeds through a comprehensive asset management strategy to reduce the vacancy rate from 75% to 2% and bring back to life this business park.
A mixed-use site located in the southern office core of Leeds, Squarestone Growth acquired Central Park in 2017 for £7.5 million and was presented with a derelict 1960s office building, a vacant 60,000 sq ft warehouse as well as three 1980s office pavilions and a large car park.
Convinced of the value the asset held subject to the right investment strategy, in less than two years Squarestone Growth deployed its expertise in refurbishing and re-tenating well-located, regional office assets across the UK to completely upgrade Central Park and deliver a rental increase from £12.50 to £17psf.
Initiatives to reposition the asset included demolishing of the derelict office building and the vacant warehouse undergoing a circa.£1.2 million refurbishment to create a Merchandising Centre of Excellence for ASDA. The supermarket has subsequently taken on a straight 10 year lease at £300,000 per annum.
Across the three office units, Squarestone Growth undertook value-add strategies to secure two, five year lease extension from existing tenants, QBE on its 22,000 sq ft of space and Estio, which also doubled its footprint to take a 10,000 sq ft unit. New tenants have also been secured further to Squarestone Growth refurbishing and splitting floorplates, and upgrading communal areas. The Davis Group took a 6,000 sq ft on a five year lease and most recently, RM Smith signed up to a 15 year lease on12,000 sq ft of space. The car park has also been refreshed to now feature LED lighting with modernised landscaping across the scheme.
Only one 2,700 sq ft unit, which is currently being upgraded to include a new canopied entrance and with dedicated toilet and kitchen facilities, remains available at Central Park . The suite will be available fully refurbished from May 2019 at £17 psf. with circa 20 car parking spaces available to lease at £1,500 per space.
Squarestone Growth founding partner, Paul Coulter commented: “Central Park was immediately attractive to us, given its low capital value and great location in the heart of Leeds. Yet whilst we knew it was well positioned and the tenant demand strong, in such a competitive market we had to create a compelling product and work closely with existing and new tenants.
“In a short space of time we have made significant achievements in delivering our intensive asset management approach. The state of the art facility we provided for ASDA underpinned the investment allowing us to focus on repositioning the office assets. As well as agreeing longer term leases with the existing tenants, we adopted flexible and affordable lease and rent structures to attract new tenants. This approach was key to appeal to the local market.
“Following completion of the final unit available we expect to be 100% occupied very shortly and are keen to invest more in the Leeds area.”