British Land has invested £470m in assets comprising the majority of Paddington Central (details here). The assets comprise of 1.2m square foot of office-led, mixed use estate close to Paddington station in London’s West End.
Some £400m was spent on income generating assets, with a net initial yield of 5.3 per cent on expiry of rent frees, rising to 6.2 per cent when fully let. The site is well placed to benefit from new rail developments, including a new Hammersmith & City line station in 2014 and a new Paddington Crossrail station in 2018.
Chris Grigg, chief executive of British Land, said:
We are delighted to have bought into Paddington Central. It is an investment which plays to our asset management and development strengths, is in line with our strategy of increasing exposure to London and replenishing the development pipeline, and one we expect to generate strong returns. This is the most significant acquisition we have made since the equity placing in March and we are confident that investment of those proceeds will now be accretive to 2014 earnings, ahead of our original objective.