RE Capital has completed the acquisition of Albion House, a 29,174 sq ft office building at 20 Queen Elizabeth Street in Southwark, London, from Peabody for £15.05 million. This follows the purchase of 1-7 Old Queen Street last year and is part of our goal to acquire up to £150 million of central London offices in 2021.
Commenting on the announcement, Newman Leech, CEO of RE Capital said, “The acquisition aligns with RE Capital’s strategy in the office market to re-position strong under-lying assets in core locations, in order to deliver more relevant workplaces in a rapidly changing occupational landscape and at a time when more people are returning to the office. Our London team have done an excellent job identifying this opportunity, at a substantial discount to market value and in securing the debt financing with Invesco, a highly regarded player in the office lending space. We look forward to delivering superior returns to our investors on this asset.”
“We expect offices to stay in demand, but in a different from, where occupiers will demand more functionality from their workplaces in order to continue attracting and retaining the best talent” said Sean Gaskell, Head of Group Capital Raising and Investor Relations, RE Capital. “That is why we are confident in our investment strategy and that returns will deliver in line with expectations.”
Albion House is currently vacant, and we have planned a comprehensive refurbishment programme to reposition the office, working with renowned architect, Hale Brown. Due for completion in early 2022, the renovation will focus on wellness and sustainability, whilst at the same time optimising the asset’s Victorian heritage and DNA. This will include a reconfigured reception space, new courtyard and roof terraces, with outstanding views to The Tower of London and the City office towers.
Our asset management team have made significant progress with the business plan since exchange of contracts in December. The majority of the design work has been completed and soft strip out works will commence immediately this week, in addition to which the planning application is ready to be submitted for the roof terrace and improvements to the entrance.
Albion House is close to local and national transport links at London Bridge, Tower Hill and Bermondsey, as well as cultural landmarks such as Borough Market, Tate Modern, Maltby Street Market, Shakespeare’s Globe Theatre and the Shard.
“Albion House represented a unique opportunity to buy a vacant and extremely well-located office in central London at a very attractive price, and we look forward to executing our strategy for this asset,” said Simon Banks, Head of RE Capital UK. “We remain long-term believers in both London and the office as a part of working life and this latest transaction is an important milestone in our ongoing strategy to acquire up to £150 million of central London offices this year.”
“The importance of our environment in our day-to-day lives and in the wellbeing of our workforce has never been more crucial,” added Ben Robinson, Senior Investment Manager, RE Capital. “As the UK continues to emerge from lockdown, we believe that we will continue to see occupiers looking to relocate to best-in-class offices in accessible locations and we are excited to bring nearly 30,000 sq ft of Grade A office space to this popular submarket.”