June 16, 2015
Palmer Capital and Opus Land have completed the acquisition of 54 Hagley Road in the Edgbaston area of Birmingham from Westbrook Partners for circa £23m, as investors continue to favour the Midlands city, CoStar News can reveal.
CoStar News understands that the duo has been joined in the development partnership by a Middle Eastern investor, with the deal representing a net initial yield of 7.8%.
Opus Land, the Midlands-based developer, is part owned and funded by Palmer Capital.
According to market sources the process didn’t go to final bids; instead the deal concluded swiftly and over asking price.
Tudor Toone had been instructed by Westbrook to sell the long leasehold interest in the 140,000 sq ft office scheme for £20.25m, reflecting a net initial yield of 9%.
CoStar News understands that the trio’s desire to secure the asset stems from the scarcity of larger floorplates in the Colmore business district.
The bigger requirements are now looking towards areas outside the city core – such as Edgbaston – as a viable option, with quoting rents rising from £12 to £14.50 per sq ft.
Westbrook decided the time was right to sell after securing Extra Energy for a 35,000 sq ft letting In March, and having reduced the vacancy in the building to around the 15% mark over the past year.
The energy firm is taking office space over the fourth to ninth floors, in what is the largest office occupier deal signed in the Midlands city so far this year.
Pennycuick Collins, the chartered surveyors, signed a five-year lease for 5,400 sq ft on the twelfth floor of the building in February.
Other tenants include: wholesale suppliers Visual Food, quantity surveyor Francis Graves and construction and property consultant RLF.
Tudor Toone represented Westbrook Partners.
GBR Phoenix Beard acted on behalf of Palmer Capital, Opus Land and Middle Eastern investor.
Author: Chris Borland, CoStar
Link: http://www.costar.co.uk/en/assets/news/2015/June/Palmer-Capital-and-Opus-snap-up-Brum-office/