Palm Capital, the pan-European real estate private equity specialist, announces the sale of a Grade A office building at 1 Waterfront Avenue, Edinburgh, to The Bank of London & The Middle East (“BLME”), a UK-based Islamic bank, for approximately £27 million.
The sale follows the agreement by Palm Capital of a new 16 year lease with Centrica, Scottish Gas’ parent company. The circa 94,100 sq ft building has served as the operational headquarters of Scottish Gas since 2003 where it employs around 1,800 people.
JLL, Sheridan Property Consultants and DCS Legal advised Palm Capital, who acquired the building in 2016. Darin Partners, CBRE and CMS advised BLME.
Reda Khatim, Managing Director at Palm Capital, said: “Having acquired this asset off-market in 2016 and subsequently restructured the lease with Centrica, this sale follows the completion of our business plan and realizes significant value for our investors. This investment was part of our Office 4.0 strategy where we target quality, but under managed assets and reposition them into institutional quality investment products.”
The energy-efficient HQ is set in the heart of the Edinburgh Waterfront on a former gasworks site. The award winning Grade A office building was designed by Foster & Partners’ and features glowing environmental credentials having achieved BREEAM “Excellent” certification and EPC rating of “B”.
Edinburgh is currently experiencing unprecedented demand for office space with vacancy rates at an all-time low of 2.9%. Investor demand also remains robust, in spite of political headwinds, with office investment volumes of over £430 million recorded so far in 2019 – close to double what was recorded for the whole of 2018, according to Colin Finlayson of JLL.
Source : Company