Union Investment has purchased the development of the XYZ Building in Manchester which is due to complete in August 2016 for its open-ended real estate fund UniInstitutional European Real Estate. Union Investment is acquiring the property in a forward funding and off-market transaction from the renowned developer Allied London Properties Ltd. The purchase price has not been disclosed. This is the second investment by Union Investment in Manchester, being the owner of the Radisson Blu hotel at Manchester airport since the year 2004.
The XYZ Building is located in the heart of the city centre, situated in Spinningfiels, the modern CBD of Manchester and one of UK’s largest mixed-use urban regeneration schemes. The property will provide some 14,583m² of high quality grade-A office accommodation arranged over basement, ground and eight upper floors. Three month before completion, 95% of the building is pre-let to six different tenants including NCC, Smoosmiths and Global Radio. A targeted ‘Excellent’ BREEAM rating underlines the sustainable low energy design of the building.
“We are very happy to have secured this high-quality asset in one of the most important regional markets in the UK. This acquisition underlines our successful regional market strategy we defined to invest into the UK secondary cities showing growth and outperformance”, said Martin Brühl, a member of the management board at Union Investment Real Estate GmbH.
“The XYZ Building is the perfect investment for our long-planned entry into the Manchester office market. Due to its modern design and its energy efficiency, the XYZ Building appeals to classical tenants as well as to companies from the TMT sector.”
The UK office market is one of the main investment markets of Hamburg-based Union Investment. Brühl added: “Having entered the market in 1992, we have steadily developed our real estate portfolio in London as well as in the regional markets such as Manchester, Birmingham or Cardiff. And we are continuing to actively exploit opportunities in the UK real estate markets in 2016.”
