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Lembaga Tabung Haji buys building in UK

Friday, 3 March 2017


PETALING JAYA: Pilgrim fund Lembaga Tabung Haji (LTH) is believed to have bought the headquarters of Centrica, the parent company of British Gas, that is located in Windsor, Britain.

The purchase was done via syariah-compliant investment bank, Gatehouse, that is based in London.

Gatehouse, acting on behalf of LTH, completed the deal at the end of last year, purchasing Centrica headquarters for £56.25 million.

The purchase price represented an annual yield of 5.7%. Windsor is about 50km west of London.

According to sources, the seller was Britain-based TH Real Estate, one of the largest real estate investment managers in the world.

TH Real Estate manages about 80 funds and its mandates span both debt and equity across diverse geographies, sectors, investment styles and vehicle types, according to its website.

There are between 7 and 10 years to the lease and the tenant has an option to renew it for the 121,320-sq-ft office building.

The source said it was “a good purchase” although valuations are pretty high today.

LTH is also said to be considering another purchase, 129 Wilton Road, London, which has a net lettable area of about 70,000 sq ft. The asking price for the 8 storey building in Victoria is about £73 million. Its tenants include events organiser IQPC, with Premier Oil E&P being the main tenant.

While LTH is keen on buying, the Employees Provident Fund’s (EPF) Whitefriars, 65 Fleet Street, London, is on offer to a buyer for between £160 million and £165 million, according to a source.

The EPF had bought this property for £148 million from German-based fund Union Investment in 2011 and is asking £170 million for it. A property consultancy is acting on behalf of the EPF, a source confirmed last week.

The lease for the 225,000-sq-ft office is until 2021 and offers a yield of 5.75%. It is currently the headquarters of law firm Freshfields Bruckhaus Deringer, which has confirmed it would be moving out, said a source.

Whitefriars has been on the market since 2015 and it needs refurbishment works and would not be beneficial for the EPF to hold on to for the longer term.

“The EPF is a passive investor, not an active asset manager. It needs to pay dividends to contributors every year. The cost of refurbishment needed in Whitefriars represents a capital expenditure,” said a consultant.

Moreover, the refurbishment works would take a couple of years and the EPF may not have a tenant after that. Hence, it has the option to sell this building because there is still ‘a reasonable time remaining in the lease’.”

Source by: Internet

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