Brum's £315m office blockbuster: AshbyCapital eyes £178m-plus The Colmore Building sale ...

By Paul Norman - Thursday, October 11, 2018 14:55

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Two of Birmingham's best known offices are coming to market with total guide prices in excess of £310m in a significant test of the strength of what has been buoyant investor appetite for the region's best headquarters buildings ahead of next March's Brexit deadline, CoStar News can reveal.

CoStar News understands that AshbyCapital has appointed Savills and JLL as it prepares The Colmore Building, its 14-storey multi-let office property in Birmingham’s city centre, for sale. It is understood it will be seeking in excess of £178m, or a yield of 5.2%.

Ashby bought the 329,000 sq ft building in August 2015, when it was known as Colmore Plaza and two-thirds let.

It rebranded the property to The Colmore Building, refurbished the reception and common parts and added new facilities including a coffee house, gym, treatment rooms and cycling facilities including luxury changing rooms and a drying room.

The repositioned building has secured a range of tenants, with over 83,000 sq ft let or under offer over the last 12 months and only one floor remaining.

Tenants include Vodafone, Allianz, Investec, Grant Thornton, Hogan Lovells, Rathbones, Willis Towers Watson, Chubb and serviced office provider Orega, which recently expanded its offering to create a new co-working space linking in to the café on the building’s ground floor.

The average lease is understood to be eight years to expiry and around £30 per sq ft.

The building will come to market as one of Birmingham's other best known offices, the landmark Lewis Building and Priory Court, is brought to market by Legal & General.

Reflecting on the strength of the Birmingham office investment market CoStar analyst Erin Amon, said: "Numerous large office buildings in Birmingham have sold already this year propelling the market to the fifth highest in the UK for office investment activity. Most notably, 55 Colmore Row sold for £98m in January and 2 Colmore Sq sold for £94.7m in August. The seller of the former, IM Properties, was able to nearly triple the price from the £33.8m it paid in May 2014. 

"The asset was refurbished in 2016 and has housed the operational headquarters of the Royal Institution of Chartered Surveyors (RICS) since it moved from Coventry earlier this year. Both assets were acquired by London buyers but foreign capital has made its way into the market this year as well with French Corum Asset Management’s acquisition of Swallowfield One for just under £24m and Canadian Talisker Corporation’s purchase of the Cube for £51m in June."

Link to current report here.

All parties declined to comment.

pnorman@costar.co.uk

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