Almacantar has put Southbank Place, SE1, up for sale for £875m – a 3.89% yield.
One and Two Southbank Place are home to oil giant Shell and a 280,000 sq ft WeWork – the biggest WeWork in the world.
Cushman & Wakefield is handling the sale.
Almacantar is taking advantage of the current demand for assets on the space-starved and increasingly popular South Bank.
Sources said the sale was “market-motivated, not asset-motivated” and that Almacantar would retain the property if bids did not reflect the marketing price.
The developer had anticipated holding the asset until its first review in 2023. Shell currently pays rents of around £55 per sq ft, which would be expected to increase significantly on review, given the growth in the area.
Completed last year, the two offices form the commercial element of a wider 1.5m sq ft redevelopment on the 5.5-acre site around the Shell Centre, which is being delivered by Braeburn Estates, a joint venture between Canary Wharf and Qatari Diar.
The scheme, which consisted of refurbishing the building formerly known as the Shell Centre and the new-build Two Southbank Place to provide 572,616 sq ft of office space, was delivered on behalf of Almacantar by Canary Wharf and Qatari Diar.
Almacantar acquired the site from Braeburn Estates for more than £550m in August 2015 using a loan facility from Cain Hoy.
In February, Almacantar agreed a £420m debt refinancing for the properties with LGIM Real Assets.
At the time of the acquisition, Almacantar chief executive Mike Hussey said the area around Waterloo Station had “the potential to grow into one of the best mixed-use destinations in London” and last year nearly £1bn of investment was sunk into the London submarket.
This included Landsec ending its self-imposed acquisition hiatus with its purchase of 25 Lavington Street in December for more than £87m.
More recently, Guys & St Thomas’s Charity has agreed a £200m-plus deal to develop a site a site near Waterloo Station with Stanhope and the Baupost Group, brokered by Savills and Allied London, is understood to be in talks to acquire ITV’s former home at the London Television Centre, which was put up for sale with Knight Frank in January for £150m.
Cash raised from the sale will be redeployed into development opportunities, said a source, although Almacantar may have to be patient and sit on cash until reasonable opportunities appear.
The business is already sitting on surplus cash following the sale of 125 Shaftesbury Avenue, WC2, for £267m to Savills Investment Management last year and CAA House in Holborn, WC1, to Canada’s QuadReal Property Group and London-based institutional capital investment partner Seaforth Land for £165m.
The London-focused developer also carried out a strategic review during 2018 that saw its existing investors, which are thought to include the Agnelli family’s Exor; the Hans Wilsdorf Foundation, the charitable trust that owns Rolex; and the Wertheimer family, which owns fashion brand Chanel, double down in the London market instead of selling out.
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