A well-known Deansgate office block has been sold to Essen County Council for a staggering £29m.
Redefine International, the owners of 201 Deansgate, which is a prominent listed building only acquired the property in March 2016, as part of the AUK Portfolio. This sale means a yield of 3.5% and a premium of 14.3% on the last book value report.
The property offers 83,688 square feet of office space in Manchester and makes a net rental income of roughly £1.1m.
Speaking about the sale of 201 Deansgate, Redefine International’s CEO, Mike Watters said:
“The disposal of 201 Deansgate represents yet another significant value enhancing opportunity that the AUK Portfolio offers the company. After less than a year of ownership, we have delivered an excellent 14.3% premium to book value on behalf of our investors, whilst also de-risking the portfolio from a number of upcoming lease breaks due on the property.”
He also mentioned that the sale of 201 Deansgate would help to reduce the company’s debt on ‘favourable terms’.
The demand for office space in Manchester has increased in recent months, and the city’s office space take-up actually doubled the estimated take-up of the city of Birmingham in 2016, as more companies clamber to set up business in the popular northern city.
Many developers believe this is a trend that will continue in 2017, as Brexit takes its effect on the economy, making a move to Manchester a more attractive prospect for companies concerned at the expenses incurred by running a business in London and the South East..