Lone Star puts Glasgow Skypark on block

By Paul Norman - Thursday, October 12, 2017 15:00

Lone Star has brought to market Skypark, the 550,000 sq ft Glasgow business park it bought as part of the £1bn Project Laser acquisition of Moorfield's first maturing two private equity funds, seeking in excess of £80m, CoStar News can reveal.

Lone Star has appointed JLL to market the campus seeking a net initial yield of 7.16% and suggesting a reversionary yield of 9.84%.

The campus at Finnieston, Glasgow's digital media quarter, comprises six offices and three development sites.

There is 508,144 sq ft of offices, 8,753 sq ft of shops and 21,530 sq ft of warehousing.

It is multilet with 69.54% of the income payable by tenants and has an ovaerall WAULT of 5.48 years to expiry. Tenants include O2, Travel 2 and Serco.

Lone Star completed the acquisition of a portfolio of mixed-use UK secondary properties from Moorfield's first maturing two private equity funds for just under £1bn in 2015, financed with a whole loan from RBC Capital Markets and Wells Fargo.

RBC and Wells provided a three-year £593m whole loan on a 50:50 split at a loan-to-cost (LTC) of approximately 70%, CoStar News revealed.  

The property portfolio, dubbed Project Laser, was comprised of the majority of assets in Moorfield Real Estate Fund (MREF) and Moorfield Real Estate Fund II (MREFII) and was acquired by the Lone Star Real Estate Fund III.

The portfolio is comprised a mix of hospitality assets, business parks, offices, student accommodation and residential developments, including the Skypark and:

  • The Salisbury – Salisbury House, a Grade II-listed building situated in the City of London with 236,369 sq ft of office, retail and ancillary accommodation;
  • Pinnacle, West Riding House, a 19-storey mixed use city centre building in Leeds, 68,500 sqft prime retail space and 81,500 sqft of offices, supported by a 440 multi-storey car park.  Major tenants include retailers Next, Tesco and Superdrug and office tenants include Barnett Waddingham and the government;
  • The Towers, an urban business park in Didsbury, South Manchester, comprised of nine office buildings, totalling 290,000 sqft set within 19 acres of landscaped parkland.  Tenants include British Airways, John Lewis, Oracle and Cisco;
  • a 40% stake in the five-strong Brindleyplace office portfolio in Birmingham, which includes major occupiers Deutsche Bank, Royal Bank of Scotland Plc, Deloitte. The joint venture partner is Hines Global REIT;
  • Velocity Village, a 612,000 sq ft mixed-use commercial and residential development in Sheffield, across five buildings located on Tenter Street and comprises 364 apartments and more than 100,000 sq ft of commercial office and retail space.
  • A portfolio of 24 regional mid-market Mercure & M Gallery hotels;
  • A portfolio of 46 Shearings hotels; and
  • Domain, Queens Road, a 399-bed student accommodation block leased to University of Winchester.

Moorfield has continued to have a role as asset manager, alongside Hudson Advisors with a number of the assets now sold.

Grant Lonsdale, Real Estate Analyst, CoStar, said: “Office investment volumes in Glasgow appear to be recovering, as many expected would happen in the second half of 2017. Perhaps unsurprisingly, office investment in the city has already surpassed the total invested in 2016.”

To read CoStar's latest Glasgow office report click here

pnorman@costar.co.uk

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