Kennedy Wilson has paid Patrizia $106m (£78m) for Edinburgh’s Waverleygate office building.
The 200,000 sq ft former General Post Office building on Waterloo Place is one of the most prominent office locations in the Scottish capital, and is 97% let to tenants including Amazon, Microsoft, H&M, the Scottish government and the NHS.
Waverleygate currently produces around £4.5m of net operating income a year. Built in 1861, the building underwent a significant renovation in 2004 to provide modern, open-plan office space across eight floors behind the Grade A listed Italian Renaissance façade.
Mike Pegler, head of UK at Kennedy Wilson, said: “This acquisition reflects our view that, at current pricing levels, there is attractive value in the UK office market particularly for assets located in major employment hubs with high-quality educational institutions.
“Waverleygate immediately adds solid recurring income from a strong tenant base and presents multiple opportunities to grow NOI and asset value by further enhancing environmental credentials and overall management of the property.”
Waverleygate is adjacent to Edinburgh’s main railway station and opposite the newly opened $1.3bn St James Quarter mixed-use development.
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