Evans Randall has emerged as the front-runner to buy the 292,000 sq ft Drapers Gardens in the City, EC2, for £240m – a 5.1% yield.
The UK private bank is in advanced negotiations with owners Canary Wharf, Morgan Stanley and Exemplar over the sale of the property, which came to the market again earlier this month after German fund manager Deka opted out of buying it.
If the deal completes, it will be the first major buy for Evans Randall for many years. The private bank has recently been a seller rather than a buyer of London stock.
This month, it has sold the 201,000 sq ft Milton Gate, EC2, to AGC Equity Partners for £164m – a 6% yield – and Condor House, EC4, to SEB for £110.4m – a 5.29% yield.
Evans Randall is expected to bring in equity from a consortium of its investor clients to help to fund the purchase of Drapers Gardens, rather than use the proceeds from its recent transactions directly.
The news comes as bids are being called on close to £600m of commercial property in the Square Mile.
Second-round offers have been submitted this week for Hermes’ and BlackRock’s 400,000 sq ft Tower 42, EC2. Gerald Ronson’s Heron International, Tishman Speyer, Carlyle and Exemplar have all been linked with the £300m tower.
German fund manager Union Investment Real Estate has also this week received bids for its 260,000 sq ft 10 Gresham Street, EC2, up for sale for £180m – a 5.65% yield. Meanwhile, Propinvest has taken 41 Lothbury, EC2, to a second round of bidding. The 157,000 sq ft block came to market for £100m last month, reflecting a 5.6% yield.
CB Richard Ellis is selling agent for Drapers and advises Evans Randall; Jones Lang LaSalle is advising on the sale of Tower 42 and acting for Propinvest with HP Four; Savills is advising Union.
Hot in the city
Total value of sales £820m
Total size 1.1m sq ft
Trophy assets Tower 42, Drapers Gardens
Agents advising CBRE, JLL, HP Four, Savills
