Broadgate Properties received a boost this week with news that it is moving closer to selling 1 Exchange Square in the City for £175m as well as securing a major letting in its Ludgate office development in EC4, writes Doug Morrison.
Since July, the company has been selectively marketing 1 Exchange Square, a 367,000-sq ft office building in the Broadgate complex that is let to the European Bank for Reconstruction & Development.
The developer is now believed to be in discussions with investor syndicates as well as private individuals from the Far East – fielding offers that would reflect a yield of below 8%.
Broadgate Properties and its investment adviser, Jones Lang Wootton, were both unavailable for comment this week. But Knight Frank & Rutley confirmed that its client EBRD had been approached to buy the building, although the tenant appears to have ruled out such a move.
The disposal of 1 Exchange Square is likely to be the last major investment sale at Broadgate, with rental income now surpassing interest repayments on the development.
Earlier in the year Broadgate Properties completed debt-for-asset swap deals with the occupiers of the 280,000-sq ft Broadwalk House and the 390,000-sq ft building at 100 Liverpool Street.
The company, meanwhile, is starting to generate interest in its Ludgate development, particularly 1 Fleet Place. The 151,575-sq ft property is one of two office buildings shortlisted by Wilde Sapte.
The law firm, currently occupying three buildings in EC4, requires 120,000 sq ft in one location and has been scouring the market through St Quintin since pulling out of a preletting deal on Markborough Properties’ proposed Bull Wharf development.
Wilde Sapte’s first choice is now thought to be 1 Fleet Place. Letting agents JLW and Herring Baker Harris refused to comment, although the deal would be likely to be based on £25 per sq ft with a three-year rent-free period.
The Wilde Sapte deal has emerged following the 20,000-sq ft letting in 10 Fleet Place to Telerate Dow Jones in July.
