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TH Real Estate acquires Central London office asset for Cityhold Office Partnership

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TH Real Estate has acquired a new Central London office asset on behalf of the Cityhold Office Partnership (CHOP) – a €2.2bn pan-European office vehicle, comprising investors TIAA-CREF, AP1 & AP2.

Great Portland Estates plc’s (GPE) former West End headquarters, at 60 Great Portland Street, has been acquired for £102.15m. The building was comprehensively refurbished in 2007 by GPE to create 65,400 sq ft of grade A office space. The offices are let in their entirety to advertising firm The Engine Group, on floor-by-floor leases, expiring in January 2028, providing an unexpired term of just over 12 years. A further three multi-let retail units, totaling 13,200 sq ft, are arranged over ground and basement floors in addition to 17 residential apartments which are sold off on long lease terms.

Launched in 2015, CHOP’s initial platform comprises 2.69m sq ft (250,000 sq m) of core office space across the UK, France and Germany. Other landmark assets in Central London include One Kingdom Street and 12-14 New Fetter Lane which was acquired from GPE via a forward funding structure.

CHOP will primarily target ‘core’ investments in Tier 1 cities such as London, Paris, Munich, Hamburg, Frankfurt and Berlin. Additionally, the investment programme will invest in ‘value-add’ opportunities such as leasing, renovation and development opportunities in these Tier 1 cities, as well as stabilised core investments within Tier 2 cities, that include Madrid, Milan, Brussels and Amsterdam, among others.

Knight Frank acted on behalf of Great Portland Estates. Savills acted on behalf of TH Real Estate.

Jasper Gilbey, Director at TH Real Estate and lead adviser of the investment vehicle, said:

"Our ambitions are to grow assets under management in the Cityhold Office Partnership from c€2.2bn to €4bn+ over the next 36 months. The acquisition of 60 Great Portland Street is consistent with our strategy of targeting high quality assets located in those core office markets that provide attractive long-term growth prospects. This transaction is underpinned by a defensive capital value of £1,300 sq ft and the reversionary nature of the office and retail space provides scope for short-term value enhancement.

 "This acquisition demonstrates our strong relationship with GPE and commitment to growing our Central London portfolio and provides the partnership with increased exposure to the West-End sub-market."

Issued by Henderson Real Estate Asset Management Limited, 201 Bishopsgate, EC2M 3BN. Authorised and regulated by the Financial Conduct Authority. TH Real Estate is a name under which Henderson Real Estate Asset Management Limited provides investment products and services.

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