Nabarro LLP advises on acquisition of 10 Gresham street, London EC2 – the second of two joint ventures between Hammerson and Canada Pension Plan Investment Board

Media > Nabarro news > Nabarro advises Hammerson and Canada Pension Plan Investment Board on property acquisition

24 August 2010

Nabarro LLP's long-standing client Hammerson has set up a joint venture with the Canada Pension Plan Investment Board (CPPIB) to acquire a long leasehold interest in 10 Gresham Street, a prime office building in the City of London, for £183 million including costs of £8 million.

The vendor is Union Investment, a German fund. Hammerson will have a 30% interest in the joint venture and will manage the asset on its behalf. Hammerson’s total commitment is £55 million.

10 Gresham Street comprises 24,125 m² (260,000 ft²) of high quality offices, retail and ancillary accommodation over eight floors. The building was designed by Foster + Partners and completed in 2003. The principal occupier is Lloyds TSB Bank, with the remainder of the building let to seven other tenants including Milbank Tweed Hadley & McCloy and JC Flowers. Total rents passing, net of head rent payable, are £10.7 million p.a. Average headline rents are £44 per ft² and the average unexpired lease term is around 11 years (9 years factoring in tenant break options).

Nabarro LLP advised both Hammerson and CPPIB on the establishment of the joint venture vehicle and the associated property acquisition, following its successful involvement with the same parties in their purchase of the Silverburn Shopping Centre, Glasgow late last year. The transaction was lead by real estate partner Simon Staite, with assistance from senior associate John Crawley and associates Chris Mundell and Ian Craig. Funds and indirect real estate partner Amanda Howard advised on the establishment of the joint venture, with assistance from associate Matthew Nortcliff.

Simon Staite commented:

"This is one of a number of transactions the firm has been involved in recently evidencing that the investment market has substantially recovered in the last six months and there is a perception of value in quality assets within the City Core."