City Developments Limited (CDL) has bought Aldgate House from Hermes Investment Management and Canada Pension Plan Investment Board鈥檚 (CPPIB) London office joint venture.
The Singapore-listed real estate company said it has bought the 211,000sqft office building for 拢183m (鈧�205.2m) and will continue to seek opportunities in the UK to further enhance its recurring income streams.
In November 2013, Hermes and CPPIB acquired Aldgate House from Railways Pension Trustee Company as part of their 50:50 office joint venture. The 拢100m deal was the partnership鈥檚 first purchase following its formation a few months earlier.
Aldgate House, an eight-floor commercial building, was originally constructed in the 1970s. Since its purchase by Hermes and CPPIB, the building has undergone significant refurbishment.
It now benefits from an occupancy rate of 88%.
Chris Taylor, the head of private markets at Hermes Investment Management, said: 鈥淭he disposal of Aldgate House marks the culmination of a proactive asset management strategy that was put into place.
鈥淭his has included significant refurbishment works and the regearing of leaseholds within the building. Capital from this sale will be put towards the selective acquisition of assets, both within the City of London and further afield, that present an opportunity for added value to be achieved.鈥�
Frank Khoo, CDL Group鈥檚 CIO, said: 鈥淎 key focus for CDL is to grow our recurring income significantly over the next 10 years through acquisitions and organic growth which will help to mitigate the volatility of development projects.
鈥淭his acquisition will enhance CDL鈥檚 recurring income portfolio. We see tremendous potential in this prime commercial building and we continue to believe that London will remain as a global financial hub.鈥�
Khoo said there is also potential to undertake asset enhancement initiative to add value to this property, adding that CDL will continue to seek opportunities in the UK to further enhance its recurring income streams.
