TH Real Estate is close to buying a £100m Birmingham office building, in the second UK investment by its European Cities Fund.
The fund manager is understood to be purchasing 55 Colmore Row from developer IM Properties. The deal would be Birmingham’s biggest investment deal since Brindleyplace was sold for £260m to HSBC Alternative Investments by Lone Star in February this year.
The fully-let 160,000 sq ft block has tenants including RICS, Pinsent Masons, Gaucho and Savills, and was developed by IM as part of a £30m project, which completed a year ago.
The European Cities Fund has the ability to invest only in a defined list of investment cities that are “underpinned by global megatrends”, and has a target average yield of 5%. The latest Birmingham asset is understood to be trading for a yield of around 4.9%.
The income-focused, open-ended fund was launched in 2016, and earlier this year it bought the Omni Centre in Edinburgh, a 220,000 sq ft retail and leisure park, for £75m. Earlier this month it hit almost €1bn of equity commitments and now has almost the same amount of assets under management.
IM Properties’ redevelopment of 55 Colmore Row involved the addition of two new floors, set behind the Grade II Listed Victorian façade with a vista across St Philips Cathedral, at the centre of the city’s business district.
Coleshill-based IM Properties is one of the largest privately owned property companies in the UK and has a significant presence in the West Midlands.
Joint letting agents for the office space were Savills and CBRE, with Birmingham-based BWD Retail handling the retail and leisure leasing.
Savills is advising IM Properties.
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