L&G Sells Argyll Street Office Block in London

Legal & General Investment Management Real Assets (LGIM Real Assets) announces, on behalf of its Life Fund, that it has sold 9 Argyll Street, London W1 to a Private Overseas Investor for £21.25 million, which equates to a net initial yield of 2.81%.The sale follows a series of successful asset management initiatives on the property, which have delivered a strong return for LGIM Real Assets’ Life Fund.

9 Argyll Street sits in the heart of the west end of London. The building comprises a retail unit, which is let to Jigsaw, arranged over the basement, ground and first floors with five floors of separately accessed office accommodation above.

This year the building has undergone a significant asset management programme to complete the business plan and deliver value for the Fund. This has involved an innovative approach to the rent review of the retail unit which was successfully concluded, resulting in an increase of rent of 49% and setting a new high for the street.

Furthermore, we have also restructured the lease for the 6th floor offices, and refurbished and re-let the 4th and 5th floors within five months of their respective lease expiries, securing headline rents of £72.50 per sq ft, thereby doubling the office rents over the last two years.

James Whitehill, Senior Fund Manager of the Life Fund at LGIM Real Assets, said: “The successful conclusion of the various initiatives under the business plan coupled with the subsequent sale are testament to the expertise of our asset management team. These initiatives have in turn delivered excellent returns for the Fund.”

CBRE acted for LGIM Real Assets on the sale, and Springer Nicolas acted for the buyer.