LondonMetric Property has exchanged contracts on the corporate disposal of Unilever House, Leatherhead for GBP75.8m to Lembaga Tabung Haji (LTH), advised by Gatehouse Bank.
LTH is a Malaysian Islamic institution with GBP6bn of assets under management.
The sale price reflects a net initial yield of 5.9 per cent. The disposal is expected to complete at the end of January.
The 176,100 sq ft office campus is arranged over three floors housing Unilever’s UK & Ireland headquarters. It was purpose built for Unilever in 2008 and acquired by LondonMetric in June 2012 for GBP61.15m, reflecting a net initial yield of 6.85 per cent.
The disposal generates an ungeared total return of 16.1 per cent per annum and a geared IRR of 32.8 per cent.
The sale is in line with LondonMetric’s strategy of focussing on the out of town retail and distribution sectors. Following the disposal, the LondonMetric office investment portfolio will comprise Marlow International in Marlow and Forest House and Elm Court Park in Crawley with a combined value of GBP74.1m, representing 7.4 per cent of the enlarged Group’s portfolio.
Patrick Vaughan, chairman of LondonMetric, says: “The successful disposal of Unilever House ahead of the September valuation is evidence of strong investment demand for quality offices outside of London. The team’s ability to capture an attractive yield on this disposal provides us with further scope to recycle our investment funds into opportunities in line with our strategy and in our favoured sectors of out of town and retail distribution, where we believe we can deliver attractive long-term growth.”
Knight Frank and Downey Turner Real Estate advised LondonMetric and Savills advised Gatehouse Bank/LTH.