Purchases/planning approval
Great Portland Estates PLC
18 November 2005
GPE buys on Southbank and gains planning approval
Great Portland Estates plc ('GPE') announces the acquisition of a major
development site on Southbank. GPE has purchased the freehold interest in 231 &
235/241 Blackfriars Road, London SE1 from clients of Royal London Asset
Management for a total consideration of £11m of which £2.2m will be deferred for
up to 3 years in exchange for a share of development profits.
The 0.4 acre site is situated on the east side of Blackfriars Road, immediately
south of its junction with Southwark Street and is currently home to two office
buildings totalling 29,400 sq ft. Producing a current annual income of £345,000,
the majority of the space is let to KPMG until December 2008. The current ERV is
£513,000.
GPE is planning a development of at least 130,000 sq ft net internal area of
modern offices with ancillary residential space. The company plans to submit a
planning application in late 2006 with an intention to begin construction during
2009, post the expiry of the KPMG lease.
In a separate transaction, GPE has agreed to acquire 22/28 Shand Street, London
SE1, from Credit Suisse Asset Management for £5.1m. The building adjoins GPE's
existing holding at 14/20 Shand Street and is opposite the Group's proposed
200,000 sq ft development at Tooley Street, which gained a resolution to grant
planning permission on 15 November. 22/28 Shand Street comprises 19,500 sq ft of
offices multi-let at an average rent of £17 per sq ft. The price paid reflects
£261 per sq ft and, with an initial yield of 6.6%, rising to 7.6% on the
settlement of outstanding rent reviews, GPE expects good future growth as the
immediate surroundings are revitalized.
Toby Courtauld, Chief Executive, said 'In an increasingly difficult planning
environment, Blackfriars Road presents a first class project for the future. It
is an efficient site, not hindered by neighbouring buildings, where we can
provide good open plan floor plates. It also has the benefit of being income
producing while we plan for its redevelopment. Shand Street is a sensible buy
for us as it will benefit from surrounding development at both Tooley Street and
More London giving us healthy rental growth prospects as a result'.
Contacts:
Toby Courtauld Chief Executive Great Portland Estates plc 020 7612 1442
Robert Noel Property Director Great Portland Estates plc 020 7612 1443
Edward Orlebar Finsbury 020 7251 3801
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