Green consortium acquires landmark London building

A consortium comprising Green Property and a syndicate of Irish investors has acquired the landmark London building that will house the headquarters of Goldman Sachs in a deal worth £246.5 million sterling (€386 million).

River Court, at 120 Fleet Street, is leased to the US broker and is currently being fitted out. The 425,000 sq ft property, which was completed last June, consists of 415,000 sq ft of office space. The 10,000 sq ft ground floor is occupied by Boots the chemists.

Goldman's lease is for 25 years with a tenant's break after 20 years. The initial income for the property is £15.6 million per annum or £39.75 per square foot - a yield of 6.25 per cent, according to Green, which makes up 50 per cent of the syndicate. The freehold was acquired from Itochu Corporation of Japan with a cash investment of £40 million, while the remainder was funded by German mortgage bank debt.

"This acquisition represents the largest ever deal in London's mid-town area," Green managing director Mr Stephen Vernon said. "We are extremely pleased to have secured this flagship property with such a strong covenant and have no doubt that the property offers considerable reversionary potential."

Green also said its UK operation was set to undertake the joint venture development, with Nightingale Estates, of a 25,000 sq ft office building near St Paul's Cathedral, its first City of London development.