RDI has exchanged contracts with the West Midlands Pension Fund for the £26m sale of the City Point office building in Leeds.
The sale price represents a net initial yield of 5.8% and a 15.3% premium to the last reported market value. The firm acquired the 61,379 sq ft property as part of its AUK Portfolio purchase in March 2015 for £21.6m with more than 17% vacancy.
In January 2017, Blacks Solicitors agreed to rent the remaining 11,000 sq ft of space, taking it to full occupancy.
The geared internal rate of return over the investment period was over 20%. The property provides a total rental income of £1.6m.
RDI said it was disposing of the property as part of its strategy of recycling capital out of mature assets and into new growth opportunities.
Mike Watters, chief executive at RDI, said: “The disposal of City Point represents yet another example of delivering value from the AUK acquisition.
“After two years of owning this asset, we have delivered an excellent 20.6% premium to the acquisition price, while also derisking the portfolio by reducing our exposure to a maturing regional office investment market and an asset with a number of upcoming lease breaks and expiries.
“We are confident the progress on our active recycling will support our relentless focus to deliver superior, sustainable and growing distributions.”
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