Pillar and its partners in the City of London Office Unit Trust are looking to raise more than £100m by transferring the £475m CityPoint tower into a new vehicle and selling part of their stake.
In a move that will be a first for the City, investors will be offered the opportunity to buy tradeable units in the multilet 700,000 sq ft EC2 scheme. A single unit will be priced at £500,000, with a minimum investment of £5m.
Pillar holds the £475m tower in CLOUT with fellow investors Schroders and Caisse des Depots.
However, the trio wants to raise cash to fund CLOUT’s acquisitions and its London development projects.
The fully let CityPoint produces a rent roll of £32m pa, and is CLOUT’s most attractive asset. The other buildings in the fund are two development sites: the combined 133,000 sq ft35 Basinghall Street, EC2, and the 177,000 sq ft Austral House, EC2; and the multilet 195,000 sq ft Plumtree Court, EC4. These will remain in the existing unit trust.
Pillar’s Eugene Doyle said the move was partly prompted by investors’ lack of appetite for the development risk in the existing CLOUT fund.
FPDSavills has been appointed to assess whether there is an appetite for indirect exposure to the City. Schroders will then issue a prospectus.
Some City agents have speculated that Pillar is prepared to sell the entire building, and Delancey has been putting together a bid consortium.
Pillar chief executive Patrick Vaughan said: “We have stated our intention to widen the investment base and focus on asset management. But, like any property company, we will consider any exceptional offers.”
