Great Portland Estates has acquired a development site and two adjoining investment properties in Tooley Street, where it plans to develop at least 120,000 sq ft of offices.
In four separate transactions, totaling £18.725 million, GPE has purchased an investment property at 156/164 Tooley Street; the freehold interest of a site immediately to the rear; the leasehold interest of the same site; and an adjacent investment property at 14-20 Shand Street.
The properties at Tooley Street (25,000 sq ft) and Shand Street (22,500 sq ft) were acquired for £12.075 million from Asda Property Holdings and generate rental income of £755,000 per annum, which is expected to rise to £900,000 by the end of 2004. The reversionary rental value is estimated to be approximately £1 million per annum.
The development site, acquired from Arlington Group plc, extends to approximately 1 acre and is directly opposite the new 3 million sq ft More London development. GPE intends to demolish the existing 27,000 sq ft of vacant 1950s warehouse property in order to develop at least 120,000 sq ft net of modern, prominently located offices.
The company expects to submit a planning application in the near future, with completion of the new buildings anticipated during 2007.
"We have quietly assembled this site in order to become involved in the regeneration of this part of central London," said chief executive Toby Courtauld. "Tooley Street and the South Bank have already benefited from improvements to the transport infrastructure and corporate acceptability of the location and we believe this positive trend is set to continue. We will be delivering high quality, well located offices, offering good value into a strengthening market."