Acquisition of Empress State Building

RNS Number : 8513F

Capital & Counties Properties Plc

30 May 2013

 



30 MAY 2013

CAPITAL & COUNTIES PROPERTIES PLC ACQUIRES EMPRESS STATE BUILDING

Capital & Counties Properties PLC ("Capco") is pleased to announce it has acquired control of 100 per cent of the Empress State Building having exchanged contracts with Land Securities Group PLC for the 50 per cent not already owned for a price of £117 million.

The Empress State Building is a 451,000 sq ft, 31 storey, office building located adjacent to the Earls Court & West Kensington Opportunity Area. It is fully let to the Mayor's Office for Policing and Crime until June 2019, with annual rental uplifts indexed to RPI with a floor of 2 per cent and cap of 5.25 per cent. The current rent passing is £14.9 million. The purchase price represents an initial yield of 6.2 per cent and an equivalent yield of 6 per cent.

In the medium-term, opportunities to extend or review the existing lease will be considered or alternatively the property may be suitable for a residential conversion in line with the plans for the Earls Court Masterplan.

The price of £117 million will comprise a cash payment and the assumption of Land Securities' share of the existing £131 million debt facility, which will remain in place until maturity in August 2013. A new five year debt facility is currently under negotiation.

Gary Yardley, Investment Director of Capco, commented:

"The Empress State Building provides an attractive income stream until 2019 whilst offering a number of options to create further value over the medium-term as the area benefits from the implementation of the Earls Court Masterplan."

Scott Parsons, Head of Property, London at Land Securities said:

"The sale of the Empress State Building fits our strategy of recycling capital through disposals where we do not see an opportunity for full control of the asset management or development of the site."

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Capital & Counties Properties PLC
Soumen Das, Finance Director Gary Yardley, Investment Director	Tel:          [phone] Tel:          [phone]
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About Capital & Counties Properties PLC (Capco):

CAPITAL & COUNTIES PROPERTIES PLC is one of the largest listed companies that specialises in central London real estate and is a constituent of the FTSE-250 Index. CAPITAL & COUNTIES PROPERTIES PLC holds 3.0 million square feet of assets valued at £1.7 billion (as at 31 December 2012) in three landmark London estates: Covent Garden, which has assets valued at £952 million, including the historic Market Building; Earls Court & Olympia Group and 50% of the Empress State building in Earls Court amounting to aggregate property assets of £721 million; and the Great Capital Partnership, a joint venture with Great Portland Estates, which holds prime West End properties of which Capco's share is £48 million. The company is listed on the London Stock Exchange and the JSE, Johannesburg.

 

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