This Week's London Deal Sheet
The Deal Sheet is a weekly compilation of Greater London and beyond's biggest leases, sales, financing deals, construction updates and personnel moves. Have news you’d like to submit? Email mark.faithfull@bisnow.com.
Real estate investment manager Barings has secured planning consent to add two floors to 25 Moorgate, a Grade A office building in the City, as a part of a refurbishment programme that will deliver a total of 79.5K SF upon completion in the fourth quarter of 2024, of which 72K SF will be offices.
The planning consent from the City of London Corp. allows a comprehensive refurbishment of the building, including two new floors and over 4,500 SF of terracing across four floors.
Barings acquired the asset on behalf of its Barings Real Estate European Value-Add II in March 2022 and is refurbishing the space alongside development manager LBS Properties and architect Morrow + Lorraine.
Blenheim House Construction has been awarded the main construction contract, and pre-letting is being handled by joint agents JLL and Cushman & Wakefield.
“With Capital House at 85 King William Street now fully occupied and both TIDE Bankside and 25 Moorgate becoming available to pre-let, we remain confident in the attractiveness of workspaces with prime ESG credentials in prime locations,” Barings Director UK Asset Management Paul Smith said in a statement.
FINANCE
Macquarie Asset Management, on behalf of Just Group, has provided approximately £30M to help finance the development of a new multipurpose healthcare service facility to be operated by University Hospital Southampton NHS Foundation Trust.
The forward funding agreement with specialist health and care property developer Prime will enable the development of a sterile services facility, aseptic pharmacy, office and parking space at the Adanac Health and Innovation Campus, a short distance from Southampton General Hospital.
When completed in 2025, the new facility is expected to provide essential hospital support services, research and nonresidential care facilities to the NHS trust while creating capacity for expanded clinical services at the general hospital site.
University Hospital Southampton NHS Foundation Trust is the largest NHS trust on the south coast of England, serving 3.7 million residents across central southern England and the Channel Islands.
***
Capital & Regional has raised £25M from shareholders to assist it in funding its acquisition of The Gyle Shopping Centre in Edinburgh.
The REIT purchased the scheme for a total consideration of £40M, with the remainder of the transaction financed through existing funds and a new debt facility of £16M.
Of the £25M fundraising, 12.6% was supplied by minority shareholders, while the company’s largest shareholder, Growthpoint, provided the remainder and now has a 67.64% holding in the REIT.
The 415K SF Gyle Shopping Centre houses 88 retail units and is anchored by a Morrisons supermarket and a Marks & Spencer store.
ACQUISITIONS
Orchard Street Investment Management has completed the first acquisition on behalf of its £400M impact fund. The Orchard Street Social and Environmental Impact Partnership acquired Euroway Trade Park, a multi-let industrial estate in Aylesford.
The freehold property comprises seven units totalling approximately 89K SF. Five of the seven units have lease expiries within 12 months, offering Orchard Street the ability to grow rental income in the short term and materially improve the sustainability credentials of the estate in line with the fund’s impact objectives, the company said.
Orchard Street said that it intends to undertake low embodied carbon refurbishments, install solar photovoltaic panels and electric vehicle charging hubs, electrify all units across the estate, and improve the EPCs to A and A+ ratings from the current C to E ratings.
The acquisition follows the first close of Orchard Street’s Impact Fund in November 2022, with cornerstone investment from Brunel Pension Partnership, one of the UK’s Local Government Pension Scheme pools. The fund's capital also includes co-investment from Orchard Street’s partners and members of its senior team.
Orchard Street was advised on the acquisition by M1, while the seller was advised by Knight Frank.
LEASING
UK Commercial Property REIT has fully let Sussex Junction, its new 107K SF industrial development in Bolney, West Sussex.
Birch Sussex, an asset storage and concierge business, has let the circa 47K SF Unit 1 on a 15-year lease without break, which increased the rental rate of the property to £14.50 per SF, delivering annual rental income of circa £677K. The agreement commences with two years at half-rent and five yearly open-market rent reviews.
Completed in February 2023, Sussex Junction comprises three industrial units, the other two of which total circa 60K SF and were both pre-let to geological survey company CGG in November 2021 on 15-year leases at a combined annual rent of around £781K, equating to £12.50 per SF.
***
Property consultancy Cluttons has moved its London office headquarters from the West End to the City after taking a 10-year lease at Yarnwicke on Cannon Street and will occupy circa 8,500 SF.
Cluttons has offices in Oxford, Newcastle and Reading and opened an office in Manchester around two years ago to support expansion in the north.
SALES
Kew Waterside, a former pumping station on 1.71 acres near Kew Gardens Station, is on the market with planning permission for a senior living development for the construction of 88 self-contained apartments with associated extra care provision.
The project comprises the demolition of the existing structures and infrastructure associated with the Kew Biothane Plant and the construction of new buildings with associated external ground-level car parking.
Aside from the residential units, the ground floor will be dedicated to communal and wellbeing facilities, including a public café and the residential apartments contained at the first floor and above.
PEOPLE
London residential developer Astir has made a trio of new hires as it looks to grow its development footprint in the capital.
Percy Mullany, John Lahiff and Chris Chapman have all joined Astir, focusing on new land acquisitions across the capital.
Astir describes itself as a newly established developer, owner and manager of multitenure places aspiring to transform the living sectors in the UK.
Mullany joins Astir as land director to head up the land and planning team from Berkeley Group, Lahiff joins as senior land manager, and Chapman has joined as an adviser/consultant.
Astir is nearing completion of its West Hampstead Central scheme of 94 one- and two-bedroom apartments, flexible office and retail space. Astir has also acquired Tesco’s 4-acre superstore site in Lewisham where it is working with Tesco to secure planning consent for a multi-use scheme that includes a new Tesco store, rental housing, a hotel, student accommodation, coworking and community uses.
