Kajima has sealed a deal to buy an office block in the heart of London’s Soho for just over £45m.
The acquisition of 27 Soho Square, W1, was made below the £50m at which Federated Hermes began marketing the building in March. The price tag equals a yield of roughly 4% based on current income.
The seven-storey, 31,000 sq ft building is let to tenants including Barclays Bank, Muse Developments, fintech venture capitalist Dawn Capital, media agency John Ayling & Associates and data company Genius Sports. Marketing documents for the asset noted there is “significant potential” to increase income by leasing the Barclays space as a “destination restaurant”.
Tim James, investment director at Kajima, said the building is “a milestone addition to our London office portfolio”, adding that it “continues our aggregation strategy into core London submarkets where we seek to identify value-add opportunities that are supported by robust occupational demand drivers”.
The investor’s other London office assets include 77 Coleman Street, EC2, and Orwell House, W1, which received planning permission in May for a refurbishment and extension.
Fineman Ross acted for Kajima, while Harris Associates advised Federated Hermes.
Jonathan Harris, chief executive at Harris Associates, described the deal as “a landmark transaction, demonstrating the true resilience for prime London office developments”.
Harris added: “Contrary to other global markets, London’s appeal in the face of instability and unpredictability continues to draw the appetite of international investors, reinforcing its position as a secure investment location.”
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Image: Harris Associates
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