The sale of Birmingham’s Exchange Buildings has now officially been concluded by Aviva investors, in a deal that observers have suggested is worth £40 million.
Reflecting a net initial yield of 4.5%, the deal was done on behalf of Aviva life and Pension and the yield is understood to be one of the keenest paid for a retail asset in Birmingham during the phase.
Exchange Buildings, which is home to HSBC, sits directly adjacent to Grand Central Shopping Centre and New Street Station. It was sold to Orchard Street Investment Management on behalf of St James’s Place Wealth Management.
The scheme which fronts New Street and Stephenson Place, consists of four retail units that extend to 25,853 sq ft, anchored by HSBC and McDonalds, as well as a 140 bedroom Premier Inn Hotel.
Commenting the deal, AVIVA Investors’ asset manager, Julian Cobourne, said: “The deal was the culmination of a carefully managed asset management programme, undertaken over a number of years.
Firstly, to pre-let and refurbish the tower element of the property, which was successfully achieved to Premier Inn Hotels.”
Tom Chadwick, investment transactions manager at Orchard Street, added: “The Exchange Buildings occupy an excellent position in the heart of Birmingham’s retail core offering both income security, with WAULT of 14 years, and access to rental growth following the adjacent redevelopment of Grand Central and the entrance of new occupiers, such as Apple, to the Birmingham market.”
Acting on behalf of Aviva Investors was Ben Kelly, capital markets director from JLL’S Birmingham, who concludes: “Our client considered that with the completion of the asset management plan, it was an optimum time to dispose of Exchange Buildings at a premium.
“Clearly the development of New Street Station, Grand Central and the opening of the new John Lewis also played a critical part of not only the timing of sale, but the positive message we were able to present to prospective buyers.
GBR Phoenix Beard acted on behalf of Orchard Street.