Tottenham Court Road is the latest location to see a significant sale of office space. London-focused REIT Derwent London has just purchased 250,000 square feet at the Central Cross development, sold by Glebe Holdings.
Glebe originally purchased the buildings on Tottenham Court Road and Stephen Street for £215 million in 2007; Derwent paid only £146 million for them. The development brings in over £8 million per year, realising Derwent a yield of 5.5 percent.
Approximately one third of their current income from their 10 tenants is secured until 2020, whilst around the same amount may be subject to a break at the end of next year. The average rent is £34 per square foot.
Derwent London’s chief executive, John Burns, commented in a press release: ‘This acquisition provides strong income at economic rental levels, together with opportunities for active management, future refurbishment and improvement… which will benefit substantially from nearby infrastructure improvements including Crossrail.’
Image: Crossrail station, Tottenham Court Road. Flickr (Mark Hillary)