Praxis, the UK property investment and management platform, and Veld Capital, the private credit specialist investor, have bought the Brindleyplace offices campus in Birmingham city centre for £125 million in a deal revealed by CoStar News.
The prime 14.9-acre canalside campus, bought from HSBC Alternative Investments, is one of Birmingham’s leading business and leisure destinations and one of the UK's best-known office developments. It is the largest regional office transaction of the year to complete.
Developed in the early 2000s by Argent, the developer behind mixed-use locations including the King’s Cross Estate in London and One Piccadilly Gardens in Manchester, Brindleyplace comprises several office-led buildings. The campus also has ground floor leisure space, a multi-storey car park, as well as a retail arcade, four-star hotel, art gallery, aquarium and a leisure scheme, providing a broad and attractive range of amenities. The estate is 90% occupied with tenants including Deutsche Bank, Michael Page, Lloyds, Deloitte, Marsh, Lloyds, Q-Parks, Zizzi, Pret a Manger and Piccolino.
Under the previous ownership, the estate saw significant capital investment as well as the delivery of the new tram connection and the opening of the neighbouring Paradise development.
Praxis and Veld said Birmingham is experiencing unprecedented levels of investment and infrastructure improvement, including the high-speed railway project HS2, which is planned to link London to Birmingham in just 45 minutes by 2030.
Sebastien Wigdo, partner at Veld Capital, said in a statement: “We are pleased to have acquired such a landmark, income generating estate with strong existing ESG credentials and clear decarbonisation potential. This acquisition adds to our recently assembled portfolio of UK regional office properties with Praxis in what we believe is a once-in-a-cycle opportunity to invest and aggregate best-in-class properties, with strong fundamentals, at a very compelling entry basis. It also illustrates our pragmatic approach as a solutions-provider for sellers of high-quality assets in an uncertain economic climate.”
CoStar News revealed last year that ACRE Capital Real Estate and JLL had been instructed on the sale in a key test of investor appetite for the most prime UK regional offices.
Praxis is a UK real estate investor and developer with around £1.2 billion in assets under management.
Hines UK was retained as the asset manager for buildings three, four, five, six and the Oozells building at nine Brindleyplace, when Hines Global and Lone Star sold the estate in 2017 to HSBC Alternative Investments. Also included in the sale is the Pavilion in the Square which is occupied by Costa Coffee.
Hines Global had a 60% stake and Lone Star 40% in the office-led campus. Deutsche Bank occupies nearly 130,000 square feet at 5 Brindleyplace.
The headlease interest sold comprised 811,665 square feet in total, including 525,777 square feet of offices with retail at ground floor, 41,568 square feet of retail and leisure accommodation in the Brunswick Arcade and Cafe in the Square and 244,320 square feet of car parks.
The buildings form part of the overall canalside Brindleyplace development in the heart of Birmingham, which comprises 11 prime office buildings, retail and leisure amenities, tree-lined streets and three public squares.
The campus is one of Birmingham’s major business and leisure destinations with a business community of over 8,000 people.
Lone Star acquired its share in the offices at the end of 2014 as part of the £1 billion deal for Moorfield's legacy fund assets. Moorfield and Hines bought the five buildings from the Brindleyplace Partnership for £190 million in 2010.
According to CoStar data it is the largest office investment deal outside London this year, and the 11th nationally including the capital. It is the biggest office investment deal in the big six UK cities of Manchester, Birmingham, Glasgow, Edinburgh, Leeds and Bristol since the Liz Truss government's mini budget in September of last year.
ACRE and JLL advised the vendor. Gerald Eve advised Praxis and Veld.