AEW announces that it has acquired the former Scottish Stock Exchange building, a prime retail-led asset in Glasgow on behalf of the AEW Europe City Retail Fund (the “Fund”) for c.£33 million. The property, which is located at 153-159 Buchanan Street & 6-11 Nelson Mandela Place, is the Fund’s first acquisition in the UK.
The Category A listed landmark property comprises 57,190 sq ft in total and provides 24,920 sq ft of retail space and 22,704 sq ft of office accommodation. The acquisition of the building gives AEW ownership of one of the most significant and well-positioned retail sites in Scotland.
The property is fully let to nine tenants. The ground and first two floors of the property are anchored by The North Face and Urban Outfitters, who have been trading there since 2001. The third and fourth floors are let to The Scottish Ministers (the Scottish arm of the NHS), while the fifth floor comprises three smaller office suites. Three further restaurant/leisure units on the ground and lower ground floors fronting on to Nelson Mandela Place are occupied by Subway, Carlsberg UK, and Absurd Bird.
The five-story building is positioned in the heart of Glasgow’s shopping district known locally as the ‘Style Mile’ with the retail frontage on Buchanan Street, which is the prime pedestrianised thoroughfare. The asset is directly adjacent to the Apple store and the street is home to a number of well-known brands including Hugo Boss, Zara, Nike and Nespresso, and also comprises jewellery arcades, restaurants and high-end office assets.
Spencer Corkin, Director of Investments said: “This is one of the best retail assets in Scotland, reflecting our highly selective acquisition strategy in the UK. Buchanan Street is second only to London’s West End in terms of footfall and retail spend, yet it provides a significant prime yield margin. The micro location’s fundamentals remain particularly attractive with almost zero availability and robust occupier demand driving strong rental growth in recent years.”
Christina Ofschonka, Fund Manager Europe City Retail: “Through this acquisition we have added another high quality asset to the Fund portfolio and we have a strong pipeline of further potential investments. Over the last 12 months we have expanded the breadth and depth of our investor base with new investors from Italy and the Netherlands, reflecting the strong appetite among institutions for this focused retail strategy.”
The Europe City Retail Fund focuses on acquiring high quality, income producing assets in prime locations across Europe’s capital and tier one cities. The latest acquisition brings the Fund’s portfolio to 21 assets across ten cities, including Copenhagen, Dublin, Glasgow, Madrid, Milan and Paris, with a total value of over €620 million.
AEW was advised by Brodies and Cushman & Wakefield and the vendor, Aberdeen Standard Investments, by Shepherd + Wedderburn and CBRE.
Source : Company