Partner Article

The Bower office development acquired in £250m transaction

Property investment and development company, Helical Bar plc has exchanged contracts on the purchase of 207 Old Street, London EC1 and 211 Old Street, London EC1, collectively known as The Bower development, for a combined price of £248m.

The vendor was a joint venture company owned by Helical and an affiliate of Crosstree Real Estate Partners LLP.

Simultaneously, Crosstree has agreed to acquire the Joint Venture’s retail parade, at 183-213 Old Street, London EC1, for £23m.

Last week, the Joint Venture announced the sale of Empire House, the hotel asset that comprised part of the 3.12 acre site, for £20.65m, to Standard Life Investments Long Lease Fund.

Helical will acquire 207 Old Street Unit Trust and 211 Old Street Unit Trust and dispose of its interest in the Old Street Retail Unit Trust, the asset owning entities, for a combined net £76m payment to Crosstree, plus refinancing the existing external debt of £88m.

The company will fund the acquisition through existing cash resources of £18m and new bank finance of £200m, £146m of which will be drawn down to complete the purchase with £54m available to fund the redevelopment of 207 Old Street.

This second phase will provide 170,000 sq ft of office space and 7,300 sq ft of retail/restaurant space, on completion of the works. Helical’s existing cash equity plus share of profits to date, a total of £84m, will remain invested in the scheme.

Gerald Kaye, Helical’s Development Director, said: “We acquired The Bower, in joint venture with Crosstree, at a time when the renaissance of the Old Street quarter was in its early days, and have seen the area transformed over the last three years, supported in part by the achievements we have made at the scheme to date.

“We have been seeking to increase our investment holdings in London for some time as well as to retain ongoing development exposure. “We have recently sold our London office assets at Enterprise House, Clifton Street and Artillery Lane and this acquisition of The Bower restates and reinforces our commitment to London, and in particular the ‘Tech Belt’ area.

“The acquisition will increase our London holdings to c. 55% of our investment portfolio. We expect The Bower will be a significant long term holding for Helical and we are confident it will contribute to the continued growth of the Company.”

This was posted in Bdaily's Members' News section by Ellen Forster .