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Newcastle, 14th May 2013 - Jones Lang LaSalle has successfully completed the sale of a 55,000 sq ft office building at Cobalt Business Park in North Tyneside on behalf of the LPA Receiver. The sale represents the biggest out of town office deal in the North East so far this year.
New Hedley House at 12A Cobalt, is let to Proctor & Gamble for an unexpired term of 4 years at a rent of £793,325 per annum.
The property was first marketed by Jones Lang LaSalle in November 2012 and sold in March 2013 at a price of £4,150,000, which was £50,000 in excess of the asking terms. The sale price reflects a Capital Value of £75.00 per sq ft and a net initial yield of 18.06%. The property had previously been on the market with a London agent for 18 months at an inflated level and received no interest.
Dickon Wood, head of investment at Jones Lang LaSalle’s Newcastle office commented:
“Given the risks involved with a property of this nature, our asking price needed to be sufficiently attractive to entice investors. Under our advice the property was marketed at a discounted price which resulted in a significant level of interest. We received ten bids in total, 75% of which were from overseas investors and were able to agree terms with a private investor who completed the deal without the need for any external funding.
Dickon continued: ‘The overseas interest generated in this property demonstrates that there is a global appetite for the North East, however it also highlights a lack of local money with little interest from North East investors. We are now looking to source investments for the other bidders who showed an interest in this property.’
New Hedley House, which was built in 2002, is a four storey office building located towards the southern end of Cobalt, fronting Silver Fox Way. Cobalt Office Park has been hailed as one of the most successful office schemes in the UK and comprises circa 1.79m sq ft over 28 buildings. Other major occupiers include Orange, Fujitsu, Formica, North Tyneside Council and Santander.
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