Green Property Ventures has confirmed it is selling 7-8 St James’s Square, SW1, a trophy asset which currently commands the highest office rent in the West End.
Stephen Vernon and Pat Gunne’s private firm has appointed CBRE to seek offers in excess of £200m – a 3.5-4% yield.
The sale will signal the end of the vendor’s ownership of a portfolio once owned by convicted fraudster Achilleas Kallakis.
The 62,195 sq ft property is the newest building on the square and occupies a corner block with frontages to Duke of York Street, Apple Tree Yard and St James’s Square.
It is let to five tenants, including the Helly Nahmad Gallery, which agreed a record West End office rent when it took 2,959 sq ft at £185 per sq ft.
Average rent in the building is around £125 per sq ft. The total income – including 18 months’ rent guarantee on the part second and third floors, at £150 per sq ft and £120 per sq ft respectively – is £8m pa.
Other tenants are The Clubhouse, which occupies the ground and lower ground floors on a 10-year lease paying just over £50 per sq ft; Société Générale, which signed a new 10-year lease for the fourth floor this year at £150 per sq ft; Point72, which occupies the first floor on a 10-year lease at £172 per sq ft; and Ideal Art Advisory, which is on a 10-year lease paying £158 per sq ft.
A successful sale would conclude a workout process which started in 2008 when Green acquired assets from Allied Irish Bank with £750m held against them. The portfolio had been previously controlled by Kallakis, who used forged documents to obtain loans from AIB.
Green has since sold the properties held in the portfolio at a significant profit, including 111 Buckingham Palace Road, SW1, to Kennedy Wilson Europe Real Estate for £204.3m; Astral Towers in Crawley to Colony Capital for £20m; Apollo House and Lunar House in Croydon to Harel and Clal for £78m.
Knight Frank and CBRE are letting agents at the building.
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