Citi Private Bank completed the £38.5 million acquisition of the Leeds headquarters of telecommunications company for a private investor client. The property, which had a net initial yield of 7%, is in a prime spot close to the main railway station in England's fourth-largest city. The purchase won it Sale/Acquisition of the Year for Yorkshire & Humberside.
About the Project: Purpose-built for BT, the 139,079-square-foot, freehold building at One Sovereign Street is let at £19.50 per square foot, approximately 50% lower than prime rents in the city. The site has retail price index-linked rent reviews due in 2025 and 2030, and there is an opportunity to drive rental value through refurbishment. BT's lease as the sole tenant runs for another 12 years.
The building's sale was the largest office deal in Leeds in 2023 and thus will show where pricing is headed for regional assets. With the full-year Leeds' city-centre transaction volume amounting to approximately £80 million, this one deal was approximately half that total.
What the Judges Said: Stuart Howie, principal, managing director, Leeds, Avison Young called it"a dominant deal within 2023 for a strategic city-centre asset, offering potential for growth”, while Adam Varley, development director, Scarborough Group said: "The office market has been one of the most challenging sectors post pandemic with the negative narrative surrounding the future of the asset class along with the impacts of the ‘Truss/Kwarteng-mini budget’ affecting confidence. However, this sale cuts across this and showed for good quality, well located assets offices still have a place”.
They Made it Happen: Richard Brooke, partner, capital markets, Allsop; Dale Johnstone, partner, commercial investment, national, Allsop; Will Kennon, executive director, capital markets, CBRE, and Henry King, associate directory, capital markets, CBRE.
