Lone Star has kicked off the sale of assets gained through the £1bn purchase of Moorfield’s first two UK private equity real estate funds.
The company, along with joint owner Hines Global REIT, has invited agents to pitch to sell its holdings at Brindleyplace in Birmingham for an asking price of just under £300m, reflecting a circa 6% yield.
The sale will include Three, Four, Five, Six and Nine Brindleyplace, which total 638,400 sq ft. Occupiers include Royal Bank of Scotland, Deloitte and Beachcroft.
A number of agents are vying for the sales appointment, including CBRE.
Brindleyplace is one of the largest regional office campuses in the UK. Consequently, the bundle of assets being sold is one of the most prominent in the £1bn portfolio purchased by Lone Star at the end of last year.
Lone Star and Hines, which own the properties 40:60, will be looking to capitalise on the accelerated regional market, with Birmingham in particular set to benefit from the delivery of the first phase of Argent’s Paradise Circus scheme in 2018 and the arrival of HS2 in 2026.
Institutional investors priced out of the London market which are looking for higher yielding investments in the regions are expected to bid for the asset.
An early exit would benefit Lone Star, improving its IRR on the Moorfield acquisition having had to undertake minimal asset management.
Moorfield and Hines Global REIT bought the five buildings from the Brindleyplace Partnership in 2010 for £190m and since then the regional market has seen a dramatic recovery.
In October 2014, Argent sold Eleven Brindleyplace to Benson Elliot for around £30m. This was the last of its assets at the scheme, of which it led the initial development, and allowed the company to focus on the delivery of Paradise Circus.
Earlier this year Tritax sold Seven, Eight and Ten Brindleyplace to CBRE Global Investors for around £130m – a 6% yield.
One Brindleyplace is owned by Trinova and Two Brindleyplace is owned by Hansainvest.
