Goodwin Gaw is putting one of the firm’s early London acquisitions on the market
Hong Kong-based private equity real estate firm Gaw Capital Partners is putting the London headquarters of British retail giant Marks & Spencer up for sale with a price tag of approximately £250 million ($335 million).
The private equity real estate investment firm is putting the Waterside House office building in the Paddington area of London’s Westminster district on the market on behalf of a group of Korean institutions which joined Hong Kong-based Gaw in acquiring the 237,800 square foot (22,092 square metre) property for £199 million (then $321 million) in 2013.
The sale plan was revealed in a statement by CBRE, which along with investment brokerage Eastdil Secured, has been appointed as sales agents for the circa 2003 property. Gaw Capital declined to comment when reached by Mingtiandi.
The 11-storey property is 100 percent let to British department store operator Marks & Spencer through 2028, which less than one month ago announced plans to close more than 100 stores globally after it reported a 62 percent drop in profits in 2017.
Korean Institutions Cash in London Investment
Waterside House is 100% let to Marks & Spencer
Gaw announced in 2013 that it had acquired the property at 35 North Wharf Road in Paddington together with “a pool of top-tier Korean institutional investors.” A Reuters account at the time named the private equity firm’s partners in the deal as the Korean Federation of Community Credit Cooperatives (KFCC), Suhyup Bank and Hyundai Securities while Gaw specified that it also acted as an advisor on the deal and became asset manager of the property following the acquisition.
The £250 million asking price for the Richard Rogers-designed asset reflects a net initial yield of 4.5 percent on the rental income according to a CoStar account. Located a five-minute walk from the Edgware Road tube station, the property is just across the Paddington Basin from Paddington Station.
New Railway Line Boosts Connectivity
The tower is set to attract keen interest from the market due to the the imminent opening of London’s Elizabeth Line, according to CBRE. The transport line, also known as Crossrail, connects passengers at Paddington Station to Heathrow and Reading in the west and Abbey Wood and Shenfield in the east. The line is slated to fully open in December 2019.
“There is proven investor appetite for high quality assets with secure, long income. With the excitement around Crossrail and overall growth potential of the Paddington market, we are confident that Waterside House will generate significant international and domestic interest,” said James Rood, Senior Director, Central London Investment at CBRE in a statement. “The occupier market in Paddington remains robust and further growth is likely, strengthening the investment rationale.”
Gaw Capital, which maintains an office in London, has invested in eight properties in the UK capital the majority of which are office towers.
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