Schroder Real Estate Investment Trust (SREIT), advised by Gerald Eve, has sold Victory House in Brighton to NFU Mutual Insurance Society Limited (NFU) for €42.8m (£36.5m). The price reflects a true net initial yield of 4.83%. Situated in central Brighton, the 87,652ft² building is fully let to BUPA Insurance Services and Mott MacDonald at a current rent of €0.93m (£0.79m), increasing to €2.21m (£1.88m) in September on expiry of a rent-free period.
John Rodgers, head of capital markets at Gerald Eve, said: “Located close to Brighton station and with a good tenant profile, Victory House offers good long-term income and strong asset management initiatives. This disposal is in line with SREIT’s wider strategy of selling lower-yielding properties in order to generate gains from asset management and realises the capital growth in the asset during the hold period. It also demonstrates that despite the Brexit noise, there is still significant depth in the market for core assets which are achieving strong pricing.”
Angus Minford – JLL capital markets said: “Brighton is one of the key office growth markets in the UK with excellent underlying market fundamentals. Victory House provides the opportunity to acquire an asset in a prime position off low rents and these characteristics fit well with NFUM’s investment strategy.”
