September 2014– BlackRock has completed the sale of Exchange Tower to a group of Asian investors led by GAW
for £191million, equating to £395 per square foot.
by BlackRock Europe Property Fund III in 2010, Exchange Tower comprises 490,000
square feet of office accommodation over 16 floors. BlackRock undertook a
comprehensive refurbishment of common parts and completed a turnkey
refurbishment on behalf of the anchor tenant, which now occupies over half of
the building. As a result occupancy has improved to 98% from 73% at
acquisition. The transaction was structured as a forward sale to Gaw Capital
and was agreed in April this year, in advance of completion of the works.
Commenting on the sale, Chris McCormack, Director
at BlackRock Real Estate in the UK, said: “The spread between prime and
non-prime real estate across London continues to provide opportunities to
generate returns for institutional investors. We are pleased to have delivered
on our original business plan and achieved a significant total return during
the four-year investment hold period.”
“By upgrading the facilities to give the space an
ultra-modern look and feel, we have been able to attract a number of high
profile tenants, as well as securing interest from long-term capital buyers
such as Gaw Capital.”
Real Estate is the dedicated real estate investment group within BlackRock and invests in strategies across the
risk and return spectrum, providing access to all major property types. The
business manages over $24 billion of private and public real estate equity and
debt on behalf of investors worldwide in 17 offices across 11 countries in
Asia-Pacific, Europe and the US. Investment structures include commingled
funds, co-investments, joint ventures and customised separate accounts.
Gaw Capital Partners acts as the advisor and
co-investor in this deal for Korean
Teachers' Credit Union and a pool of other
Asian investors. It is the fifth acquisition in London led by
Gaw Capital Partners on behalf of its Asian clients and is its ninth separate
account direct investment since 2010.
Other notable transactions in London include Vintners’ Place in London
in 2012, the Lloyd’s Building in London in 2013 and Waterside House in
Paddington London in 2013.
Goodwin Gaw, Managing Principal and Chairman of Gaw Capital Partners,
said “As an active player in the real estate market in greater China and Asia
Pacific, Gaw Capital Partners is seeing more opportunities to assist Asian
Investors going overseas. London is one of the key global gateway cities with
high liquidity. The combination of attractive yield, trophy quality asset, and
attractive long term debt, makes London a particularly compelling market for
core real estate investments.”