Another major chunk of London’s New Bond Street is being bought by a luxury retailer.
Switzerland-based Richemont, whose brands include Cartier and Montblanc, has teamed up with New York investor Crown Acquisitions to buy 50 New Bond Street, W1, for £210m – a 2.75% yield.
50 New Bond Street is home to Mulberry’s 5,400 sq ft flagship. It pays £1.4m pa and has 20 years remaining on its lease.
The upper floors comprise 33,000 sq ft of offices. The main tenant is Ralph Lauren, which occupies 13,023 sq ft at an annual rent of £911,609 and has 10 years remaining on its lease. Other office tenants include Varde Partners Europe, Ares Management, and TMT investor Atomico Ventures.
The acquisition follows the recent trend of luxury brands buying stores along both New Bond Street and Bond Street, pushing out more traditional landlords.
Last year, Savills reported that retailers had grabbed almost 20% of all units on Bond Street, with just half of these being for their own occupation. Active investors alongside Richemont include Hermès, MaxMara and Louis Vuitton.
Rob Hargreaves, head of central London retail at BNP Paribas Real Estate, said: “Luxury groups and occupiers buy buildings to benefit from the owner occupation provisions of the Landlord and Tenant Act 1954, whereby after five years of ownership a retailer landlord has the opportunity to gain occupation of a store, and some are willing to wait as long as 20 years for this.
“It allows for strategic long-term occupational strategies in prime locations and Bond Street, being a heavily desirable address, gives owner occupiers the opportunity to invest.”
50 New Bond Street is being sold by Aberdeen Asset Management. The fund manager is streamlining its London portfolio and in the past six months has disposed of £1.7bn of assets, including 61 Southwark Street, SE1, and 1 Welbeck Street, W1.
Crown Acquisitions, which is funded by New York developer Stanley Chera, owns a number of high-profile New York properties, including 650 Madison Avenue and 450 Park Avenue.
The deal is the largest West End retail investment so far this year, ahead of Cicerone Holding’s purchase of Waterstones’ 63,000 sq ft HQ at 203-206 Piccadilly, W1, from Meyer Bergman for £92m – a 3.2% yield.
Colliers International and CBRE are acting for Aberdeen; Savills and Harper Dennis Hobbs are advising the purchasers.
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