RDI sells 127 Charing Cross Road in London for GBP59.25m
RDI, an income focused UK Real Estate Investment Trust (UK-REIT), has completed the disposal of 127 Charing Cross Road for a headline price of GBP59.25 million to Nomura Real Estate UK Limited.
The disposal price reflects a 1 per cent premium to the 31 August 2020 valuation, a net initial yield of 3.1 per cent, based on the contracted rental income, and a capital value per of GBP1,481 per sq ft on the existing area. The property was acquired as part of the AUK portfolio acquisition in March 2016 for GBP42.6 million. The disposal price therefore reflects a 39.1 per cent increase in value since acquisition.
The growth in value has been supported by a successful asset management strategy including securing full planning permission, which provides an opportunity to increase the overall area of the property by 41.1 per cent through the development of three additional floors.
Stephen Oakenfull, CEO of RDI, says: “This disposal marks the conclusion of a well-executed and successful asset management plan designed to enhance the value of an income generating asset. We believe that the sale captures a significant proportion of the asset’s potential value and provides us with the ability to recycle capital into opportunities with stronger risk-adjusted returns.
“In the meantime, the proceeds of this transaction further strengthen the balance sheet where we now have cash and available facilities totalling approximately GBP275 million to execute on our strategy.”