Birmingham Exchange Buildings hit the market

The governors of charitable trust the Schools of King Edward VI in Birmingham have appointed Knight Frank to market the long leasehold of the Exchange Buildings in the city centre, for offers over £25.6m. The centrally located, mixed-use hotel and retail investment is strategically positioned at the entrance to Grand Central train station and at the junction of New Street, Corporation Street and Stephenson Place. The property comprises four prominent retail units over 27,072 sq ft of retail space, a 140-bedroom Premier Inn hotel, rooftop telecoms, and 37 basement car parking spaces. It is let to five tenants – HSBC, Premier Inn, McDonald’s, Baguette 4 U, and Greggs – with 97% of income secured to 5A1 and 5A2 covenants. The asset has a WAULT of 11.08 years to expiry and 8.29 years break. The marketing price of £25.6m reflects an 8% net initial yield, 7.31% reversionary yield, and a capital value of £302 per sq ft. The property is held on long leasehold from the Schools of King Edward VI in Birmingham for a term of 200 years from 25 March 2015, 191 years unexpired. The ground rent is paid quarterly in advance and base rent is £143,192 pa, reviewed every 40 years, with the next review in March 2055. Check out more occupational sales comparables in Birmingham >> Photo © Knight Frank