Standard Life has sold a Mayfair office in an effort to rebalance its portfolio away from London amid concerns over the market cooling.
It has sold at least £350m in London in the months since the EU referendum and has a number of assets up for sale, including a 50% stake in a £460m portfolio of London offices (see below).
Anne Breen, head of real estate research and strategy at Standard Life Investments, said the market had been cooling off “some while before the Brexit vote in June”.
She added: “While we believe there is long-term growth in London, we are also conscious of the need to ensure our funds are not overweight in this market near term.”
The investor’s latest sale is 13-14 Curzon Street, W1, a Mayfair freehold with one of the highest recorded capital values at more than £3,100 per sq ft. It was sold to Charles Street Building Group for £39.3m – a 3.25% yield.
Leicester-based Charles Street, led by Hugh Murphy, has assets valued at more than £650m and 6m sq ft of property.
The sale reflects sustained investor appetite for deals in the capital despite Standard Life’s sentiment.
Standard Life appointed Savills to market 13-14 Curzon Street for offers in excess of £35m.
Designed by Rolfe Judd Architects, the 12,470 sq ft office occupies a corner block arranged over lower ground, ground and five upper floors. It was refurbished in 2014.
The building generates an annual rent of £1.4m, 93% of which is secured against the sole office tenant, London Executive Offices, until 2029. The lease provides for five-yearly, upward-only rent reviews, of which the next is due in October 2019, and a tenant break option in October 2024.
The ground-floor café, Benugo, pays £85,000 pa.
Chapman Petrie advised the purchaser. Savills and Chapman Petrie declined to comment.
Standard Life’s London sales since Brexit
● 13-14 Curzon Street, W1, to Charles Street Building Group for £39.3m
● Co-op Group’s HQ at St Paul’s House, 8-12 Warwick Lane, EC4, to a private buyer for £34.5m
● St James’s House, 23 King Street, SW1, to Wheelock Properties for £120m
● Watergate House, 13-15 York Buildings, WC2, to a private investor for £19.9m
● 20 King Street, SW1, to Arbuthnot Latham for £50.2m
● 80 Cheapside, EC2, to a private investor for £90.3m
● 6 Arlington Street, SW1, to Conegate for £37.6m
● A 50% stake in a £460m portfolio of London offices, is up for sale. It includes Juxon House, EC4, which is the headquarters of investment manager Sarasin & Partners
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