Hines and HSH Nordbank are lining up the sale of City office block Cannon Place, EC4, which is expected to trade for as much as £500m.
CBRE and Savills are reporting on the 400,000 sq ft building after winning the instruction at a competitive pitch earlier this year, with a formal sales process expected to start in the coming weeks.
Hines developed Cannon Place with Network Rail and manages it on behalf of a Jersey-based charitable trust set up by HSH Nordbank, which bought the building in 2013 as a part of a restructuring process.
It was previously owned by Hines and Russian investors Kirill Pisarev and Yuri Zhukov, founders of developer PIK.
The 2013 restructuring was designed to facilitate the debut letting in the building to law firm CMS Cameron McKenna, which pays £47 per sq ft for its 140,000 sq ft of space.
Hines has since achieved a string of further lettings to tenants including the CBI, Threadneedle Investments and i2 Office at significantly higher rents. The building is now 80% let, with talks advanced on the remaining space.
Hines bought the long leasehold interest on the site in 2002 and developed the eight-storey building with the help of a £300m development loan from HSH.
Network Rail retains the freehold interest in the building, which is built over Cannon Street Station.
Cannon Place, which was designed to appeal to major financial services occupiers
in need of large floorplates,
was completed in 2011 and delivered into a City leasing market which had seen demand from banks fall off a cliff as a result of the global financial crisis.
It was one of a number of high-profile buildings, including the Walbrook, EC4, which struggled to find tenants after completion but have gradually taken advantage of recovering occupier confidence.
The fully let Walbrook, which is opposite Cannon Place and is the same size, sold earlier this year for £575m – a 4% yield – to Cathay Life.
CBRE and Savills are also joint letting agents and quoting rents are £63.50 per sq ft.
jack.sidders@estatesgazette.com
