Imperial House, the Go Compare UK headquarters building at Imperial Park, Newport, has been sold for £4.66m.
Acting on behalf of vendor Urban Logistics REIT plc, property consultancy Knight Frank, jointly with M1 Agency, completed the freehold sale of the 26,672 sq ft office building to South Somerset District Council in a deal representing a Net Initial Yield (NIY) of 8%. The purchaser was advised by CBRE.
The open-plan two-storey office, which sits at the entrance to the established Imperial Park, is fully let to Go Compare with 9.55 years to lease expiry, with a lease break option at 4.55 years. It attracts a current rent of £400,080 per annum, equating to £15.00 per sq ft.
Imperial Park is one mile from Junction 28 of the M4 Motorway, just south of Celtic Springs Business Park, and is considered one of the prime business space locations in South Wales.
Gareth Lloyd, partner in the Knight Frank Capital Markets team in Cardiff, said: “Imperial House offers the opportunity for strong rental growth following the game-changing benefits of several infrastructure improvement initiatives which are all underway, and which are increasing the profile of Newport as a major regional city.”
Christopher Turner, director of vendor Urban Logistics REIT plc, said: “We acquired Imperial House as part of a portfolio of investments in 2016. By selling it at this stage we can reinvest funds into industrial and logistics property which align more closely with our overall investment portfolio.”
Brendan Fisher, investment project manager of South Somerset District Council commented: “This acquisition has been timed to coincide with the removal of the Severn Bridge toll, which improves access to Bristol. Prime Bristol rents are currently more than double the passing rent at Imperial House and the Council considers there to be excellent potential for future rental and capital growth.
“It will allow the Council to meet its annual £2m target for income generation to protect the wide range of services our communities receive and create opportunities to fund new projects.”
Tom Morris, managing director of CBRE, which advised the District Council, added: “The team at CBRE is delighted to have assisted South Somerset Council in acquiring what is the highest quality out of town office in Newport. The tenant has invested heavily in what is its national HQ and the rental tone is well placed to benefit from future growth. Factors such as the removal of the Severn Bridge tolls, planned infrastructure work around Newport and increasing rents in neighbouring Cardiff and Bristol, are all set to impact positively on the city.”
Knight Frank and M1 Agency jointly advised the vendor.