The offices have been bought from UBS Asset Management Real Estate & Private Markets. BPP has acquired the long leaseholds of Knollys House and Stephenson House in Addiscombe Road, next to East Croydon station, and in the centre of Croydon’s business district.
Arranged over 11 and seven upper floors respectively, Knollys House and Stephenson House comprise 190,987 sq ft of office space, which is multi-let to 23 tenants, providing a total gross passing rent of £4.2 million a year, equivalent to £21.99/sq ft. The weighted average unexpired lease term is 3.5 years to expiries and 2.1 years to breaks.
Tenants include the British Medical Association, the British Transport Police Authority, Mitsubishi Electric Europe, Reed Specialist Recruitment and the office for the Secretary of State for Communities and Local Government.
The acquisitions increase the size of Akoya’s portfolio to eight properties with a value of around £230 million. They follow the purchases at the end of last year of Carlson Court in Putney from the international business of Federated Hermes for £23 million and 111-115 Salusbury Road in Queens Park from a private investor for £16.5 million.
BPP launched Akoya in September 2020 to provide sustainable workplaces for creative businesses in London’s flourishing neighbourhoods. Akoya will meet the desire for workers in Greater London to work locally in the wake of the Covid-19 pandemic. It is a progressive workplace strategy, focusing on localism and a work-life balance for occupiers. Healthy lifestyles, occupier wellbeing and local communities form some of the key themes.
Jamie Acheson, Senior Director of BPP, said: “This is the sixth acqusition we have made for Akoya, our suburban London workplace strategy. We will comprehesively ‘upcycle’ the buildings, providing high- quality space, with affordable rents and wellness at the heart of our plans”.
Gijsbert van Riemsdijk, Head of Transactions EMEA (ex. Switzerland) at UBS Asset Management, commented: “The sale of this property supports the fund’s focus on core, income-accretive assets and, therefore, we intend to utilize the proceeds of this sale to progress our ongoing acquisition strategy. We are delighted to have worked with the purchaser and various parties on this sale, and
we wish them all the best with this acquisition.
“Croydon represents a sensible opportunity for investors, with over GBP 5.25 billion of development expenditure planned over the next five years. The property’s immediate vicinity is currently undergoing regeneration, including the redevelopment of local buildings to improve rail connections between Brighton and London, and the development of more office space in the area”.
BPP was advised by Montagu Evans and UBS Asset Management was advised by TT&G Partners.