M&G Real Estate, West Yorkshire Pension Fund and an Asian investor have forward purchased 101 Embankment in Manchester for £105m.
The purchase price for the 165,000 sq ft new headquarters of insurer Swinton reflects a 5.3% net initial yield.
The building, developed by Ask Developments and funded by Tristan Capital’s EPISO 3 fund, is let to Swinton on a 10-year lease and also includes a 442-space car park let to Q-Park on a 35-year lease. It completed in the first quarter of this year.
A second phase of the project includes a second 166,000 sq ft office at 100 Embankment, which is scheduled to start on site in the final quarter of the year.
Martin Towns, head of capital solutions at M&G Real Estate, says: “There is an increasing trend in global real estate for large institutional and sovereign wealth investors to partner with established fund management companies through joint ventures and separate accounts. We believe in investing time to truly understand our clients’ unique preferences and requirements, using our skills and experience to create bespoke strategies and investment opportunities that work for them.”
Chris Webb, director at Tristan Capital, said: “The dire shortage of grade A offices in the centre of Manchester made this development particularly attractive. Salford Council’s vision and progressive approach have been integral to the successful regeneration of the city centre Embankment Estate. However further work needs to be carried out; there is still insufficient space to satisfy demand in these thriving business communities, which gives us good visibility as we move into the second phase of this project.”
JLL advised Tristan and Ask. CBRE advised M&G Real Estate.
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