The Carlyle Group sells Millennium Bridge House to Shiva Hotels for £87.6 million (UK)

Global alternative asset manager, The Carlyle Group announced today it has completed the sale of Millennium Bridge House to Shiva Hotels Ltd, the UK hospitality group, for £87.6 million (approx. €105.1 million).

Millennium Bridge House is a 200,000 ft² (approx. 18,580 m²) office building located at 1 High Timber Street on the north bank of the Thames in the City of London. It is fully occupied by Old Mutual, which extended its lease by seven years in July 2013, as well as Adecco, Nedbank, ADM Investor Services and Badenoch & Clark Limited.

In June 2012, Carlyle secured planning consent for the development of a 300,000 ft² (approx. 27,870 m²), hotel on the site of Millennium Bridge House.

Carlyle acquired Millennium Bridge House in July 2010 on behalf of its third pan-European real estate fund, Carlyle European Real Estate Partners III, as part of the £671 million acquisition of a portfolio comprising six landmark central London properties which were formerly part of the White Tower 2006-3 plc CMBS portfolio.

The portfolio comprised six assets; 60 Victoria Embankment, Ludgate House, Sampson House, the BSI tower in Chiswick and Alban Gate. 60 Victoria Embankment, Alban Gate and the BSI Tower have already been sold and Carlyle has recently received planning approval from Southwark Council’s Strategic Planning Committee to replace the Sampson House data-center and Ludgate House office building with a major 1.4 million ft² residential and office regeneration project.

Commenting on the disposal, Mark Harris, Managing Director at The Carlyle Group, said: “The sale of Millennium Bridge House is the third sale we have made from the White Tower portfolio over the past three years. Since identifying the longer term opportunities of this prime Thames-side asset we have worked hard to utilize a range of active asset management and redevelopment opportunities to secure its longer term prospects enabling us to make a timely disposal in line with market demand in order to deliver significant value for our investors.”

Benjamin Du Boulay, Director at The Carlyle Group added: “This transaction is indicative of our ability to find value in a highly competitive London real estate market and to use our asset management initiatives to create an attractive investment opportunity by providing the flexibility to create value through a change of use in the future. Whilst securing planning approval to develop a hotel on the site of Millennium Bridge House, we worked with Old Mutual and our other major corporate occupiers to meet their requirements resulting in the successful re-gearing of a number of the leases in order to maintain income from the property throughout our ownership and de-risk the asset.”

Jones Lang LeSalle advised Carlyle on the transaction.

Source: FTI Consulting

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