Evans Randall, a privately-owned investment banking and equity group, are to strengthen their UK real estate portfolio with the purchase of the Drapers Gardens development in the city of London for £242.5 million.
This purchase shows an initial yield of 5.2%, however does not include a deduction for rent-free periods.
The property, measuring 292,500 sq ft, was recently let to BlackRock Investment Management on a 25 year lease.
Eurohypo, a German real estate lender provided a undisclosed debt for the acquisition in the joint venture sold by Canary Wharf Group and a subsidiary of the Morgan Stanley Real Estate Funds.
Chairman of Evans Randall, Michael Evans, said, “Drapers Gardens offers good long-term investment prospects, given the length of lease and the quality of both tenant and building. It sits well within our portfolio of trophy City properties and is part of an ongoing strategy of prime real estate acquisitions in London and major Continental cities.”
He added, “The lease benefits from a minimum uplift of 2.5% per annum for each of the first five years and a maximum uplift of 4.5% per annum. It is this certainty of rental growth that makes it particularly attractive to us.”
Evans Randalls owns around £5 billion worth of property investments, including a 50% stake in The Gherkin, as well as the 33 Old Broad Street.