Sainsbury’s Bank Headquarters at 3 Lochside Avenue in Edinburgh Park has been sold by Aviva Investors for £19 million, reflecting a yield of 6.31%.
CCLA have acquired the 84,373 sq ft property for the Local Authorities Property Fund.
Occupying a prime position within Scotland’s premier business park, the four floor building is let to Sainsbury’s Bank until September 2029. The property generates a current passing rent of £1.2 million per annum.
The sale is another milestone in the continued success story of Edinburgh Park. With a vacancy rate of only 4.50%, the business park is home to a raft of national and international occupiers including BT plc, HSBC, Diageo, Aegon and JP Morgan, employing over 7,000 people. Established in the early 1990s, the entire park extends to over 148 acres and, to date, over 1 million sq ft of offices has been built on the site.
JLL acted for Aviva Investors on the sale and Savills acted for CCLA on the acquisition.
Colin Campbell, Senior Surveyor, JLL, commented: “The sale of 3 Lochside Avenue underlines the strength in demand for the regional office market. The property fundamentals alongside the occupational success story at Edinburgh Park, limited availability and rental growth, presented an opportunity for Aviva Investors to exit their holding and maximise their return.”
Louise Swinden Associate Director at Aviva Investors said: “Our investment in 3 Lochside Avenue has performed extremely well. Funding a comprehensive refurbishment of the property enabled us to create Grade A office accommodation which is rarely available in West Edinburgh. With the subsequent letting to Sainsbury’s, we managed to secure one of the UK’s highest profile household brands on a 15 year lease, which ultimately allowed us to release enhanced value for the fund.”
Rod Leslie, Associate Director in Savills investment team in Edinburgh who advised CCLA on the acquisition, comments: “We are delighted to have secured this prime HQ office investment on the prestigious Edinburgh Park. It reflects our confidence in the location and the underlying property fundamentals, including the tenant, longevity of the income stream and the potential for future rental growth.”
CCLA’s LAPF now stands at £570m.
