CBRE Investment Management is in talks to buy the Halo office in Bristol from Tesco Pension Fund for close to £75 million in what will provide a much-needed benchmark for pricing for the most prime regional offices.
Tesco Pension Fund appointed Savills to sell the landmark, highly sustainable multilet office in Bristol city centre at the beginning of the year for £70.30 million or a 5.75% net initial yield and there is understood to have been competitive bidding.
The office, as a best-in-class regional city centre asset, might have been expected to trade at closer to a 4.75% net initial yield 12 months ago but the better-than-guide sale price will be welcome evidence that the market is strengthening.
CoStar News revealed that Cubex and Fiera Real Estate had secured forward funding for their Halo office building in Bristol from Tesco Pension Fund, for £70 million or a 5.55% yield in April 2020.
The 116,000-square-foot, Grade A office office was under construction and is part of Finzels Reach, a £400 million city centre quarter.
Halo is one of the greenest office buildings in the UK, with a BREEAM Outstanding accreditation. The building also features leading edge digital connectivity recognised with the highest ‘Wired’ Platinum score.
In February 2020, international legal firm Osborne Clarke agreed to take nearly two-thirds of Halo – 74,000 square feet – in a pre-let deal, two years ahead of completion.
Halo’s modern design features a corkscrew-like staircase rising up through a glass atrium.
Bristol developer Cubex bought the former Avon Fire and Rescue site, which will be home to Halo, in 2018 on behalf of Fiera Real Estate Opportunity Fund IV (UK), a "programmatic venture" by Fiera Real Estate that is exclusive to clients of CBRE Global Investment Partners.