Abstract agrees major pre-let and forward funding in Bristol
Abstract Securities' wholly owned subsidiary - Abstract (Bristol) Limited – has completed an agreement for lease for the letting of the final phases of its 100 Bristol Business Park development, comprising in excess of 132,000 sq ft net, to Babcock Integrated Technology Limited, together with a sale of the resulting investment to Aviva Investor’s Lime Property Fund Limited for consideration in excess of GBP55 million.
This represents one of the biggest lettings in the Bristol out of town office market for many years. The new campus consolidates Babcock’s long-term occupation in the Region and the combined phases will provide Babcock with a new Grade A office facility in excess of 218,000 sq ft net comprising two buildings each of c86,000 sq ft, a smaller office of c40,000 sq ft and c6,500 sq ft of A1/A3/A4 space which will be sublet by Babcock in due course to appropriate tenants to provide a complementary offering to the Business Park.
The site, speculatively acquired by Abstract in December 2016, was formerly the headquarters of Du Pont and comprises 7.3 acres. This announcement follows on from the letting of Phase 1 of the development comprising 86,000 sq ft, in July 2019 to Babcock, also funded by Lime Property Fund.
Bristol Business Park is an established office park situated five miles north of Bristol City Centre with excellent transport links and within easy access of the M32, M4 and M5 Motorways. In addition, Bristol Parkway Railway Station lies within 10 minutes’ drive, providing a regular Inter City service to London Paddington, within 1hr 30 mins. Major occupiers on the Park include: ALD Automotive, Boeing, Motability Finance, QinetiQ, Thales and the University of the West of England.
Babcock has agreed a 15-year full-repairing lease, at a commencing rent of approximately GBP2.67 million per annum, subject to five yearly rent reviews linked to CPI + 1 per cent, collared and capped at two per cent and four per cent per annum.
Lime Property Fund is a secure income long lease property fund managed by Aviva Investors. The fund targets property investments let to strong tenants on leases with inflation-linked or fixed-rental uplifts and lease terms of 15 years plus.
Mark Glatman, Chief Executive of Abstract Securities, says: “We are delighted to be delivering the next phases of buildings for Babcock in Bristol, and, yet again, we have been able to procure efficiencies of design and delivery which drives a highly competitive but excellent corporate workplace in keeping with a number of buildings we have delivered for Babcock across the UK over recent years. Our design and delivery teams have done another fantastic job in bringing this development forward in the current climate and the trusted relationships with Babcock and with Aviva have proved robust over recent weeks despite global uncertainty."
Jon Hall, Managing Director for Technology at Babcock, says: “We’re delighted that the campus plans are progressing with work on Phase 2 due to commence shortly. The Babcock Technology Centre, which opened in summer last year, is a modern working environment designed with our people and customers in mind. The future build will enable us to enhance current ways of working and promote a creative environment where innovation can thrive. It delivers a Bristol-based business and technology hub promoting collaboration with a range of stakeholders.”
Kris McPhail, Fund Manager, Aviva Investors, says: “We are pleased to extend our work with Abstract, a company with a long track record of delivering high-quality office accommodation for corporates. This transaction is expected to provide our institutional clients with long-term inflation-linked cashflows and consolidates the occupation of a strong tenant into two additional new buildings. These are exactly the type of investments we are actively targeting for the Lime Property Fund.”
Phase 1 of the Bristol Business Park development has been shortlisted at the British Council for Offices (BCO) Awards 2020 in the Corporate Workplace category following the judging panel visit in January. Winners will be announced in October.
Abstract was unrepresented in the letting and investment sale. DTRE acted on behalf of Aviva Investors. Lambert Smith Hampton advised Babcock.
Pinsent Masons advised Abstract in documenting the transaction. Addleshaw Goddard acted for Aviva and DWF acted for Babcock.