Sheffield city centre office building sold in £20m deal

Ediston Property Investment Company plc has sold its office building at Cutlers Gate, Sheffield, to UK Commercial Property Trust Limited for £20,165,000.

The deal reflects a net initial yield of 5% (31 March 2017 value: £19,775,000).

The property comprises 61,638 sq. ft. of offices and is let to Capita Business Services Limited, with a guarantee from Capita plc, until December 2039.

The asset was acquired by Ediston Property Investment Company plc in October 2014 for £13.5m.

During the hold period, the company struck a deal with Capita plc to extend the lease term from 11 years to 25 years, improve the rent review provisions to annual RPI uplifts, and secure the Capita plc guarantee, all of which improved the value of the asset.

Calum Bruce, director of investment at Ediston Properties Limited, the company’s Investment Manager, said: “Sheffield is a good example of the Ediston style of asset management; unlocking value from a ‘dry’ asset through a proper understanding of the tenant’s needs, creating a robust and attractive income stream and selling on to the institutional market.

“We are pleased to have quickly recycled the capital back into an ‘Ediston style’ asset which provides attractive asset management angles to exploit.

“This asset is well suited to our intensive approach to management, and allows us to recommence the value add process with a new property.”

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