Business Environment, one of the UK’s leading independent serviced office providers, today announces the completion of two sale and leasebacks for £19.5m as part of its strategy to re-balance its portfolio of 12 centres. Prior to this BE either owned freehold or long leasehold nine centres.
At 32 Threadneedle Street, EC2 BE has sold its 91 year leasehold interest, subject to a £40,000 ground rent, in the 12,530 sq ft centre to the Canals & River Trust for £10.5m and has taken a 15 year lease at an annual rental of £654,050 with five year reviews. As part of the deal BE is undertaking a major £1.95m refurbishment of the building to provide Grade A office accommodation. Hall Kemp and Michael Elliott acted for BE. Bilfinger GVA acted for the Canals & River Trust.
In addition the serviced offices provider has sold its 81 year leasehold interest in the 54,275 sq ft CityPoint Bristol office centre to the local authority for £9m and simultaneously taken a 15 year FRI lease on the building at £15 per sq ft. Rothwell Property Consultants and Michael Elliott represented BE. Hartnell Taylor Cook LLP represented Bristol City Council.
The proceeds of these disposals will be used to both reduce debt and help finance BE’s stated expansion plan that aims to grow the business substantially over the next five years.
David Saul, Managing Director of Business Environment, said: “These two sales and leasebacks form part of our strategy to re-focus our portfolio away from ownership and towards more traditional leases. While owning a majority of our centres was, in our view, the right approach historically we now believe that having a greater balance will enable us to successfully grow the business over the next five years.”