Global real estate investment company Kennedy Wilson has acquired One Embassy Gardens for $252 million in an off-market transaction that is currently expected to add $12 million in annual net operating income.
Located in London’s Nine Elms district, the 156,000 square foot, recently developed, Grade A office building was designed to minimize energy and water consumption and was awarded BREEAM Excellent certification.
One Embassy Gardens is part of the wider Embassy Gardens estate, a new riverside district immediately adjacent to the U.S. Embassy and close to Apple’s new 500,000 square foot headquarters at Battersea Power Station. The asset is 82% occupied by publisher Penguin Random House, with 8.3 years of term on the lease and a two-year rental guarantee from the vendor on the vacant space.
“One Embassy Gardens represents an excellent opportunity to recycle proceeds following the recent opportunistic sale of our central London office asset, Friars Bridge Court, where we sold at a capital value of £1,600 per sq ft and a cap rate of 3.5%. We are now buying new modern stock at £1,140 per sq ft and cap rate of 4.5%, adding $12 million of day-one NOI to Kennedy Wilson with ongoing growth prospects as the area becomes more established and rents converge to levels similar to other Central London submarkets,” said Mike Pegler, Head of UK for Kennedy Wilson.
Source : Company