Agents pick the most significant deals (12 months to end of December)
Aurora, 120 Bothwell Street, Glasgow
Type of deal Investment sale
Vendor CS EuroReal
Purchaser M&G Real Estate
Size 176,500 sq ft
Price £72.6m
Yield 6.18%
Chosen by David Davidson, managing director, C&W Scotland
I think there are several factors that help to make the sale of Aurora significant. An overriding reason for my choice is the positive signal it sends about the future of the Scottish commercial property market as the deal completed just six weeks before the general election. It is the first sale of a truly prime office building in Scotland in 2015. With only two-and-a-half years until Barclays Bank can break its leases for more than 50% of the space, it also shows the confidence of M&G in buying this building. It already owns one of the city’s top five buildings, 1 West Regent Street, so it clearly demonstrates their strong belief in the Glasgow office market. The yield, meanwhile, at just over 6%, suggests that prime yields in Scotland are now down to between 5% and 5.5% for longer-leased buildings and that yields in Glasgow and Edinburgh are coming into line with those of Birmingham and Manchester.
The Centre and Almondvale West Retail Park, Livingston
Type of deal Investment sale
Owner Land Securities
Purchaser HSBC Alternative Investments, Hines as asset manager
Size 1m sq ft (The Centre) and 116,000 sq ft (Almondvale)
Value £224.1m
Chosen by James Findlater, head of shopping centre investment, Colliers International
The sale of The Centre and the adjacent Almondvale West Retail Park was a bellwether deal for Scotland’s retail property investment market. The investment opportunity was brought to market just four months before the Scottish independence referendum. Accordingly, it was imperative that the underlying strengths of the asset were communicated to the market with clarity. Livingston has become a popular retail destination and The Centre, its 160-plus retailers making it Scotland’s second-largest covered shopping centre, together with the six-unit retail park, represented a strong retail and investment proposition. The price achieved – around £20m above market expectations – demonstrated that the sale process achieved its objective. The deal provided the Scottish retail property scene with a tremendous endorsement while enabling Land Securities to pursue further a strategy of reshaping its shopping centre portfolio.
Lloyds Register building, Prime Four, Aberdeen
Type of deal Prelet
Tenant Lloyds register EMEA
Landlord Prime Four
Size 100,000 sq ft
Rent £28.75 per sq ft
Chosen by Andrew Smith, associate, Ryden
I have chosen the Lloyds Register prelet at Prime Four because it shows the strong commitment to the energy sector in Aberdeen, despite the correction that the market is experiencing. Lloyds agreed a 15-year lease with options to extend for up to an
additional 10 years. The deal follows the merger of Senergy and Lloyds Register Shipping and is the largest prelet in Aberdeen in
the past six months. This is also the eighth office deal to be announced at the development. Lloyds Register considered various locations throughout Aberdeen during an extensive internal consultation process but Prime Four was able to offer business park amenities together with the ability to create a bespoke
facility built to the tenant’s timescale. I believe this deal shows that established companies are still willing to make long-term commitments to Aberdeen. They know their business will be in the city for years to come and that the market will bounce back as it always does.
Hotels check in on progress
Hotel developments in Edinburgh saw progress with Union Hanover Securities being granted planning for its Urban Villa boutique hotel by the Union Canal basin and TIAA Henderson Real Estate’s appointment of Jestico + Whiles to work on designs for a hotel at its St James’ scheme.
C&W fits in as agent
Cushman & Wakefield was appointed to sell a £16m mixed-use property, occupied by, among others, Urban Outfitters, in Princes Street, Edinburgh.
New role for Dorward at DTZ
At DTZ Stuart Dorward replaced James Thomson as business manager of its Edinburgh and Glasgow offices.
Homes plan for Perth
In Perth, a masterplan was submitted for a residential scheme that could deliver 1,500 homes in the Almond Valley area.
Office take-up hits a peak
JLL revealed office take-up for Edinburgh, running at 875,000 sq ft for 2014, to be the highest level for a decade.
Schools’ out for development
Two former schools were earmarked for student accommodation schemes. Unite completed on the Causewayend School in Aberdeen while Empiric Student Property was given the go-ahead to redevelop Willowbank Primary School in Glasgow.
Retail roles for CBRE
CBRE in Scotland was appointed to sell two major retail investments –in Glasgow, Mike Ashley’s Forge retail park for £82m and, in Inverness, F&C REIT’s Eastgate Centre for £120m.
Aberdeen office rates to rise
Aberdeen became the biggest loser in the recent business rates revaluation, with rates in its office market set to rise by 55%.
