Derwent London has exchanged contracts to acquire the freehold of Angel Square, Islington EC1 in London’s Tech Belt from an overseas investor for £75.03m before costs.
The prominent corner property, opposite our successful Angel Building EC1, consists of three multi-let connected buildings around a central courtyard. It principally comprises 128,700 sq ft (11,960m2) of offices above Angel underground station. The passing rent is £2.4m per annum and 12,950 sq ft (10% by area) is vacant. Rents on the let space range from £10 to £30 per sq ft, with an average of £21.68 per sq ft. The majority of the leases expire in March 2015. The net initial yield is 3.05%, which reflects a capital value of c.£610 per sq ft after costs.
This reversionary acquisition complements our major holdings in the area, and offers significant near term asset management opportunities to deal with the vacancy and next year’s expiries. Over time there is the potential to regenerate and add to this substantial building. We expect the area to continue to benefit from its location midway between the new developments at King’s Cross and Old Street roundabout.
John Burns, Chief Executive Officer, commented:
“We are pleased to have acquired a significant property in this fast improving area. It provides short term asset management opportunities, and longer term we expect to reposition the buildings replicating our successes in nearby properties.”