DTZ Investors has bought Combined House and International House in Kingston-upon-Thames, Surrey, for £55.9m – a net initial yield of 4.8%.
The property includes two 10-storey buildings and a shopping centre with 144,200 sq ft of hotel and retail space, alongside a 366-space multi-storey car park.
Premier Inn and Travelodge occupy the two hotels and account for 55% of the property’s income stream.
About 35% of the income comes from the retail units and the remaining 10% from the car park.
Peter O’Gorman, fund manager at DTZ Investors, said: “This asset will deliver a sustainable income stream while providing good growth potential at minimal risk.
“With a weighted average unexpired lease term of 17.2 years and 85% of the income on fixed or index-linked reviews, this asset will provide defensive and reliable returns for the fund.”
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