Shaftesbury Asset Management Group has agreed a deal to buy the long leasehold interest in 20 Grosvenor Street, W1, from Grosvenor Britain & Ireland for £96m, CoStar News can reveal.
Grosvenor, advised by Knight Frank, has sold the 125-year leasehold interest in the newly redeveloped Mayfair property to a private client of Shaftesbury Asset Management Group, an independent European real estate investment, fund and asset management firm. The group is a subsidiary of Shaftesbury International Holdings (SIH).
Grosvenor instructed Knight Frank earlier this year to sell the trophy asset for £95m, reflecting a net initial yield of 3.84% and a capital value of £2,198 per sq ft.
The building was let to KPMG in 2014 on a 15-year lease. In addition to 39,681 sq ft of office space, which incorporates the ‘Big Four’ accountancy giant’s high-end client entertaining and meeting space, there are two retail units, comprising The Refinery barber and spa as well as a café.
Twenty Grosvenor Street was offered by way of a new 125-year leasehold interest from Grosvenor geared at 10% of rents received.
The building produces total gross passing rent of £4.29m per annum, equating to an average office rent of £103.95 per sq ft, which is lower than core West end rents which stand at around £180 per sq ft. Around 98% of the income is secured to KPMG until 15 February 2030 with a lease break on 15 February 2025.
The Flanagan Lawrence-designed redevelopment of 20 Grosvenor Street completed last year. It amalgamated numbers 18 and 20 Grosvenor Street, originally built in 1725, to create grade A office space over six floors, together with two retail units on ground and lower ground level.
Grosvenor will retain the building’s freehold as part of its 300-acre London estate in Mayfair and Belgravia.
Craig McWilliam, Executive Director, London estate at Grosvenor Britain & Ireland said: “The proceeds from 20 Grosvenor Street will help us continue to invest in our London estate, ensuring it both thrives and flourishes as a place to live, work and visit in the heart of London’s West End.”
The Shaftesbury Asset Management Group is an independent fund and asset management group headquartered in Luxembourg and has platforms in Germany, France, Spain and Switzerland. The group’s total assets under management currently exceed £1.2bn, on behalf of both institutional and private clients. The firm is on the acquisitions trail at present, eying further real estate investments to the tune of £800m in Spain, Portugal, France, Switzerland, Germany and the UK.