Standard Life is the frontrunner to buy a landmark office block in the Quartermile area of Edinburgh’s city centre.
The company is understood to be the favourite to buy Aviva Investor’s 121,500 sq ft Quartermile One building at the former Royal Infirmary site.
Other bids have come from PRUPIM and German funds GLL Real Estate Partners and Deka Immobilien, as well as investment manager Danmerc.
The scheme, built in 2007, has a price tag of £36.5m, giving a net initial yield of 7.07%. However, bids have come in at sub 7%, equating to circa £38m.
The annual rent roll is £2.7m pa and the building is more than 90% let to Investec Wealth & Investment, and law firm Maclay Murray and Spens, Mercer and Skyscanner. Two of the leases allow for minimum uplift at review, while the Skyscanner lease provides a fixed uplift at review to £30 per sq ft.
The scheme comprises 105,000 sq ft of offices and 16,500 sq ft of lower ground floor leisure.
Yields have compressed in Edinburgh over the last six months, and the investment market has been dominated by overseas investors looking to acquire trophy sites with asset management potential.
GVA is handling the sale for Aviva Investors.
lisa.pilkington@estatesgazette.com
