In a major vote of confidence for Birmingham city centre’s office market, German investor CGI is speculatively funding Richardson Barberry’s No 1 Colmore Square for around £65m. The price reflects a yield of 7.25%.
Local sources claim the fund has agreed terms on the 17,650m2 flagship office building, based on a rent of around £258 per m2 a year.
The deal would be a big departure for German funds, which usually invest in or around London. One investment source said: “They’ve been sniffing around for some time but I’m surprised they’re getting involved with that level of funding.”
Richardson Barberry has just won planning consent for the 10-storey scheme, which is the second phase of the former Lewis’s department store redevelopment. Approval for the scheme followed intense negotiations with the council over road improvements and construction of a new public square.
DTZ Debenham Thorpe is representing both the developer and CGI.
