Lancaster House, 67 Newhall Street, Birmingham, B3 1NQMake an enquiry
Franck-Steier Price has recently completed the acquisition of Lancaster House in Birmingham city centre on behalf of Custodian REIT Plc.
The property is prominently located in Birmingham’s Central Business District on the corner of Great Charles Street and Newhall Street and comprises a Portland Stone office building arranged over basement, ground and six upper floors. The total floor area is 39,616 sq.ft with individual floor plates extending to 5.570 sq.ft. There is a two storey annex to the rear of the property which is let as storage accommodation and 14 car parking spaces accessed off Great Charles Street.
The property is multi-let to sixteen tenants with one suite on part of the 1st floor and two stores vacant. The total income is £489,479 per annum with an average rent across the office space of £13.00 per sq.ft. The weighted average unexpired lease term to break is 3.3 years and to expiry is 4.2 years. 72% of the suites have been let or renewed in the last 15 months.
The purchase price of £6,194,000 reflects a net initial yield of 7.47%, assuming purchaser’s costs of 5.80%, and a capital value of £156 per sq.ft.
The vendor was New Wood Securities, represented by Savills.
Ben Blackwall, Director at FSP comments ‘The property is very well located within short walking distance of Birmingham’s rail stations and central shopping area. The majority of the building has been refurbished recently to a Grade A specification and the average rents are over 50% lower than comparable space on Colmore and £3.00 per sq.ft lower than recent lettings on Great Charles Street.’
‘We are of the view that the property offers excellent scope for rental growth in a location where there is little competing supply. Over 260,000 sq.ft of competing office space in the immediate vicinity has been, or will shortly be, converted to residential accommodation.’