The Sauchiehall Building, one of Glasgow's prime shopping hubs let to retailers including Primark and TK Maxx, has been put up for sale for £60.6m, reflecting a 6% yield.
Quadrant Estates and US private equity firm KKR have hired Montagu Evans to sell the 313,000 sq ft high street block on Sauchiehall Street, one of the main shopping thoroughfares in Glasgow city centre.
The pair acquired it three years ago and have since regeared a number of the leases and secured new lettings with retailers Sports Direct and Millets. A part of the building was recently refurbished to create three new restaurants - two let so far to Smashburger and Chilango.
Primark anchors the property with a 65,000 sq ft store generating 28% of the income. Other tenants include TK Maxx, WH Smith, Superdrug, RBS, Elanic, and a 30,000 sq ft Pure Gym.
The building has also a car park on the top three floors, let to Q Park, which accounts for around 20% of the income. The total passing rent is £3.7m per annum and the outstanding WAULT is 16.8 years to expiries and 15.8 years to break options.
The Sauchiehall Building is the latest in a string of retail assets to come to market in Glasgow this year, with recent sales including the Apple Store at 147 Buchanan Street to Zara owner Amancio Ortega's property vehicle Ponte Gadea and Redevco's acquisition of Nike's flagship store on Buchanan Street for £29.27m, reflecting a 4.30% yield.
In February, a private investor snapped up 50/59 Buchanan Street, a retail parade let to retailers including Russell & Bromley, for £22.5m reflecting a yield of 4% and in June, George Capital bought the Empire Building, a retail and office block on Sauchiehall Street, for £17.5m.
"Prime yields on Buchanan Street are presently at 4% and with downwards pressure likely to continue, The Sauchiehall Building provides the opportunity to secure a prime mixed-use asset on Glasgow’s Golden Z at a level which represents significant value relative to Buchanan Street," Montagu Evans said.
Kasmira Jefford - CoStar