Warwick Capital Partners has instructed Savills to sell a government-let Leeds office block for £16.4m – a net initial yield of 8.25%.
Castle House on Lisbon Street in the West End area of Leeds comprises 78,298 sq ft across ground and 13 upper floors. The building is let to the secretary of state for the environment and occupied by HMRC at a passing rent of £1.4m, on a lease with 6.75 years unexpired.
Castle House is adjacent to the West One development and opposite MEPC, Hermes Investment Management and Canada Pension Plan Investment Board’s Wellington Place campus, which the Government Property Unit has selected as the preferred destination for its 380,000 sq ft civil service hub requirement.
Occupiers in the West End area of the Leeds include PwC, Squire Patton Boggs, RSM Tenon and Equifax.
Simon Lister, investment director at Savills Leeds, said: “Castle House is let to a rock-solid tenant off a very attractive passing rent, which benefits from an RPI uplift next year. The property’s strategic location and regular configuration also offer potential for medium-term conversion to residential, student accommodation or hotel use, subject to necessary consents, making it a very desirable investment opportunity.”
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