Fri, 04/04/2014 - 16:04
Orchard Street Investment Management has completed on the acquisition of The Arena, Stockley Park, on behalf of one of its clients, from Cube Real Estate for GBP13.31m.
The sale price represents a net initial yield of 6.2 per cent.
The Arena acts as the amenity hub for Stockley Park’s 7,000 strong captive audience, providing a variety of retail and leisure uses. The asset comprises 66,248 sq ft of purpose built space including a health club, four retail units, two bar/restaurant units, as well as two office units, together with 145 car parking spaces. Split over two floors, current tenants include Virgin Active, which anchors the scheme, JD Weatherspoons, Costa, WH Smith, Subway and Greggs.
The property is currently let on 10 separate leases, with an average weighted unexpired lease term of 15.9 years to breaks. The purchase also comes with the benefit of a planning consent in place for the development of an additional 22,380 sq ft of office space and there are also a number of longer term redevelopment opportunities for a variety of different uses, including residential space, subject to planning.
Stockley Park is one of UK’s leading business parks, with 1.74 million sq ft of office space. It is currently home to a range of blue chip companies including Marks and Spencer, GlaxoSmithKline, Apple (UK) Ltd, BP, Canon Toshiba and IMG.
Gary Felce, partner at Orchard Street, says: “By acquiring The Arena we have gained exposure to a leisure and retail hub situated on what is arguably the best and most established business park in the South East. With Virgin Active anchoring the scheme, representing 70 per cent of the income, and 95 per cent of the income being let, reviewed or renewed since 2009, there is a very strong base for future rental growth. In addition, there are a number of further asset management opportunities available to improve the tenant mix and retail offering in the short-to-medium term.”
Michael Elliott acted for Orchard Street. Cortex acted for the vendor.
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