Patrizia UK has acquired the 85,000ft² (7,900m²) Manchester office building, Linley House for £12m (€15.4m), with a net initial yield of 7%. This follows PATRIZIA UK’s first Mancunian acquisition in May when it purchased the 20-acre mixed-use ‘First Street’ site. The acquisition represents a further purchase as part of Patrizia’s Value-Add strategy.
Located on Dickinson Street in the heart of Manchester, the nine-storey Linley House is just under 95% let and provides refurbished grade-A office space to occupiers such as Electricity North West, My Home Move, and London School of Business and Finance, producing a combined passing rent of £890,000 (€1.1m) p.a. and with a WAULT of 3 years.
This area of Manchester is now also set to benefit from the development activity surrounding Oxford Road, creating a new prime area with strong rental growth over the next three years.
Rob Brook, Patrizia UK, said: “Manchester continues to generate excitement in the office market. Patrizia UK has always been interested in assets that offer the opportunity for driving rental growth and place making through active asset management, and on the verge of prime Linley House marks the ideal next step into the Manchester office market.”
James Porteous, capital markets director, JLL, said: “We have seen a range of institutional investment into refurbished accommodation and there continues to be a strong occupational demand which will undoubtedly generate significant rental growth for high quality assets across the city.
“The building is occupied by a strong mix of tenants and has genuine reversionary lease potential. In addition the Oxford Corridor improvements and extension of the prime office core at St Peters Square will also add to Linley House’s existing prospects as a city centre asset.”
