Property group Ho Bee Land announced yesterday that its wholly owned subsidiary, Grandeur Property Investments, has completed its acquisition of Frasia Properties S.à.r.l for £650 million (S$1.16 billion) in London.
Registered in Luxembourg, Frasia owns a freehold property known as Ropemaker Place, a 21-storey Grade A office building comprising approximately 602,000 sq ft of commercial space.
The property is strategically located to take maximum advantage of the introduction of Crossrail - to be completed and operational in December this year - with the Moorgate station less than 200m away. Just about 400m away is the Liverpool Street Station, which is the busiest transportation hub in the City of London.
The property is currently multi-let with a weighted average lease term of 10.5 years to expiry and 8.5 years to break option. It offers a running yield of approximately 4.68 per cent with an annual rental income of about £30.57 million, with the office accommodation accounting for 97.4 per cent. The property will be held for long-term investment.
With the acquisition of Ropemaker Place, Ho Bee Land's total investment in London has risen to $2.4 billion, which constitutes 41 per cent of the group's total investment portfolio.
Ho Bee Land chairman and CEO Chua Thian Poh said: "Despite Brexit, London has proven resilient and maintained its position as the world's top financial city ahead of New York. We remain confident of the long-term prospects of London. The Brexit uncertainty has, in fact, provided us with the opportunity to suss out excellent investment opportunities like Ropemaker Place."
He added that the acquisition allows the group to "substantially grow its robust and sustainable recurrent income base".
Ho Bee Land's total investment in London, with the acquisition of Ropemaker Place.
The acquisition is financed by internal funds and bank borrowings. It is expected to contribute positively to the consolidated earnings per share and net tangible assets per share of Ho Bee Land group for the financial year ending Dec 31, 2018.
Ho Bee Land's London advisory team in this transaction includes Dentons, Deloitte and Savills.