AIB INVESTMENT Managers (AIBIM) is planning to cash in on the resurgent London commercial property market by seeking offers in excess of £65 million for a key retail and office investment on King’s Road in Chelsea.
The multiple trader Marks Spencer occupies the ground floor of the distinctive red-brick building at 81 to 103 King’s Road, which was bought on behalf of about 20 Irish investors in 2004 for £54 million.
At a price of £65 million, the investment would show a net yield of about 5 per cent.
Caroline McCarthy of estate agents CB Richard Ellis, which is handling the sale, said yesterday that there was a particularly strong demand at the moment for prime-retail investments in central London, with most of the inquiries coming from overseas funds.
Major retailers were also buying up properties in strategic locations.
AIBIM had apparently urged its Irish clients to cash in on the high valuations on King’s Road at this time. If the portfolio is successfully offloaded at £65 million or more, it is thought likely that some of the beneficiaries will opt to reinvest their funds in the Dublin market where capital values have fallen across the board by up to 50 per cent.
One drawback is the extreme scarcity of bank funding in Dublin for property investments.
Marks Spencer contributes about 75 per cent of the £3 million rent roll on the King’s Road investment and its lease has another 13 years to run.
The balance of the rent on the 5,852sq m (63,000sq ft) building comes from a single office tenant on the first and second floors as well as from a basement car park which can accommodate 106 cars. It is one of the few buildings on King’s Road with car parking.
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