Legal & General Property has completed a £370m purchase of the Bishopsgate Long Term Property Fund Unit Trust, which owns 24 properties.
The purchase price – on behalf of Legal & General Capital and PGGM – reflects a 6% yield.
Cordea Savills won the UK investment mandate for Bishopsgate Long Term Property Fund Unit Trust in 2013. The fund was launched on 30 November 2012.
The portfolio will now be held as a Jersey limited partnership, with PGGM and LGC acting as limited partners and LGP acting as the fund manager.
Some 1.5m sq ft across the UK makes up the portfolio, which includes offices in London such as 101 St Martins Lane, WC2 (pictured).
Nearly 60% of the 24 assets by value are in London and the South East, the remaining 40% are located in regional cities such as Manchester, Cardiff, Leeds and Glasgow.
They have a passing rent of £21.7m and a 2.3% vacancy rate as a percentage of ERV.
A moderate level of gearing will also be introduced to the portfolio, which previously held no debt. As a result, LGC has also provided a £142m facility to the partnership, reflecting a 40% loan-to-value ratio based on the September valuation.
Mathieu Elshout, senior investment manager at PGGM, said: “We look forward to making similar investments in due course.”
Michael Barrie, director of fund management at Legal & General Property, added: “We believe that our success in securing this investment came down to the certainty and speed of execution that we could offer the vendor, based on our proven ability to handle complex transactions in a short time period, quality of capital, with an all cash offer, and high standards of confidentiality.”
Knight Frank acted for LGP; CBRE Capital Advisors represented the vendor.
