We purchased Harmsworth House as part of a portfolio with funds managed by Tristan Capital Partners. The property is multi-let with 62,000 sq. ft. of offices. The building was fully let at purchase with rents averaging £27 per sq. ft. compared to an estimated rental value of around £40 per sq. ft.
The building was held on a long lease with 62 years unexpired at a rent of £296,000 per annum. The occupational leases were due to expire in 2020.
We agreed new leases on the 4th & 6th floors at £45 per sq. ft. The 1st floor tenant had agreed terms to assign its lease to another party. We stepped in to take a surrender of this lease to enable a refurbishment of the floor and to drive rents forward. We also carried out a cosmetic refurbishment of the entrance hall.
At the same time, we worked with architects to prepare a massing study to show that the site could support a new building of approximately 106,000 sq. ft. net. The building was sold subject to the existing leases for £28,200,000 representing a yield of 6.25%.
