West Midlands Pension Fund has purchased more
office space in Central London. The company has bought St. Andrew's House in tandem with ING Real Estate Investment Management, the overall purchasing price being no less than £25.2 million.
The commercial property is situated in the Mid-town district of London and consists of as much as 51,000 square feet of office space spaced over ten floors. At the moment, it is being let on a floor-by-floor basis, with the current tenant being accountancy and consultancy firm PwC, who will be occupying the building for nearly another two years, until September 2013.
"West Midlands has a strong and diversified portfolio and is comfortable taking on asset management opportunities such as this," says the fund manager of ING Real Estate Investment Management, Mike Daggett. "The purchase of St Andrew's House adds to the fund's existing West End holdings and will enable the fund to take full advantage of the anticipated out-performance of Central London offices over at least the next two or three years." Daggett went on to add that St. Andrew's House also produces a very attractive running yield as well as offering a number of options for value enhancing asset management in the medium term, including the likes of full refurbishment and the adding of new floors plus simple lease restructuring.
There will be an initial yield of 6.6 per cent.
