Birmingham’s Mailbox falls in value by almost a fifth

The value of Birmingham’s Mailbox office scheme has fallen by close to a fifth over the past quarter, pushing its owner to open talks with its lender over covenants. Mailbox REIT, which owns the asset and is listed on the IPSX market, said a year-end valuation by Avison Young valued the building at £157m, down by 17% from £189.7m at the end of September. The REIT said the fall “primarily reflects the outward yield shift for regional office assets in the current market largely due to the prevailing interest rate turbulence”. Mailbox REIT is now in talks with Deutsche Bank, which provided a £108.5m loan secured against the site. The valuation fall takes the loan-to-value ratio to 69.1%, versus an agreed covenant of 60% and a ratio of 57.2% at the end of September. The REIT said it “expects to be able to announce a resolution to this issue in the near future”. To send feedback, e-mail tim.burke@eg.co.uk or tweet @_tim_burke or @EGPropertyNews Compare and explore the Birmingham office market >> Photo © Mailbox REIT