Land Securities is in talks to sell the Thomas More Square estate to Resolution Property for around £300m – a 5.5% yield.
The fund manager is in exclusive discussions to buy the 566,000 sq ft office campus, which occupies a 4.2-acre freehold site in Wapping, E1.
The deal comes after Resolution agreed a value-add joint venture with China’s largest private investment group Fosun in July which will provide a platform for the anticipated launch of Resolution’s fifth fund later this year.
For LandSec the deal would net a substantial profit, having bought in the 50% of the estate it did not already own in November last year from Ontario Teachers’ Pension Plan Board for £85.3m.
The REIT secured consent for the comprehensive refurbishment of the 200,000 sq ft building three on the estate in June last year and has since let the majority of the space. Tenants includes Ipsos More, Mitsui OSK Lines and St Mungo’s Broadway. Around 59,000 sq ft remains available.
A further 71,000 sq ft of refurbished space is due to be delivered at the estate by September next year in buildings two, four, five and six.
Thomas More Square was previously home to parts of Rupert Murdoch’s UK media empire prior to its move to London Bridge Quarter, SE1, last year.
The REIT has also undertaken a redesign of the estate’s public realm, creating 10,000 sq ft of restaurants and shops due to open later this year.
Resolution specialises in revitalising offices in off-pitch locations drawing in digital and creative occupiers.
Its recent London projects have included the Alphabeta building, EC2, on the edge of the City and Shoreditch and Department W on Mile End Road, E1.
It also recently completed the purchase of Black Lion House at 45 Whitechapel Road, E1, on behalf of its existing fourth fund which it plans to refurbish.
CBRE is advising Land Securities on the sale.
