US investor Peabody Global Real Estate Partners has paid the UK’s Standard Life Investments £300m for the Cutlers Gardens estate close to London’s Square Mile. Real estate private equity fund Peabody is backed by J P Morgan Chase & Co and The OConnor Group.
Alex Watt, managing director of property investments at Standard Life, said: “Standard Life Investments has a substantial development commitment within its portfolio. The sale of Cutlers Gardens has realised a significant sum that is being reinvested in our ambitious speculative development programme in the UK and Continental Europe, which has a projected end value in excess of £1bn.”
Cutlers Gardens comprises 10 buildings clustered around two central courtyards, providing 56,576m2 of offices with ancillary retail, restaurants and a health club. The sale also includes Shield House, a 3,159m2 potential development site adjacent to Cutlers Gardens.
The investment is let to 75 tenants including AON, Hammond Suddards Edge, Invesco, Northern Trust, Pru Bache and Scottish Equitable.
Julian Nairn of selling agent Jones Lang LaSalle, said: “We are absolutely delighted to have achieved a price significantly in advance of our client’s expectations. It shows the strength of the market for active managed properties. We had seven bids approaching almost £2bn which shows the volume of demand out in the market.”
Standard Life is committed to two major speculative development projects in the City of London, between them creating around 35,302 sq m (380,000 sq ft). Construction has now started at 10 Gresham Street on a 23,225 sq m (250,000 sq ft) eight-storey building on an island site next to Goldsmiths Hall, while an 11,891 sq m (128,000 sq ft) speculative development is planned at Juxon House.
Peabody was advised by Dawnay Day and Lambert Smith Hampton.
