LEADENHALL STREET 78-79 - City of London Freehold Asset Management Opportunity - NET
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78-79
LEADENHALL STREET
LONDON EC3
City of London Freehold Asset Management Opportunity
executive summary
A reversionary mixed use building benefiting
from its proximity to the Tower cluster and
the ‘Tech Belt’
• Freehold.
• Prominent mixed-use building located in the heart of EC3,
benefiting from its proximity to Lloyd’s of London and the ever
evolving ‘Tech Belt’ to the east.
• The property comprises 15,236 sq ft (1,415.5 sq m) of office and
retail accommodation arranged over basement, ground and five
upper floors.
• The property is multi-let to eight tenants and producing a rental
income of £623,502 per annum (inclusive of rental top-ups)
reflecting a highly reversionary overall rent of £40.92 per sq ft.
• The weighted average unexpired lease term is 5.49 years (3.01 years
to earliest determination), providing an attractive income profile.
• Asset management opportunities include refurbishment of existing
floors to capture higher headline rents, enhancement of end of
journey facilities, regearing of existing leases and longer-term
potential for additional massing (subject to planning).
• Offers are invited in excess of £11,675,000 (Eleven Million Six
Hundred Seventy Five Thousand Pounds Sterling) for our client’s
freehold interest, which reflects a Net Initial Yield of 5.00%
(assuming full purchaser’s costs of 6.80%) and a capital value of
£766 per sq ft. Subject to contract and exclusive of VAT.
02 03
Tower of london tower hill FENCHURCH street st paul’s cathedral TOWER CLUSTER aldgate liverpool street spitalfields market 04 05
Location
78 – 79 Leadenhall Street is located in the heart of EC3,
an area which attracts global corporations from the
financial, insurance, legal and TMT industries.
The attraction for these occupiers includes its access to the traditional City core,
including Lloyd’s of London, the world’s largest insurance market, and accessibility to
the ‘Tech Belt’ in the east.
The property occupies a prominent position on the north side of Leadenhall Street
near the junction with Fenchurch Street, two globally recognised streets within the
City of London’s tower cluster. Nearby developments include 122 Leadenhall Street
(The Cheesegrater), 20 Fenchurch Street (Walkie-Talkie) and 30 St Mary Axe (The
Gherkin). In addition, the area will be further enhanced with the completion of a
number of high-profile developments such as 50 Fenchurch Street, One Leadenhall
and 40 Leadenhall Street (Stanza).
In addition to the unrivalled commercial developments within the immediate locale,
the area also benefits from a number of hotels and an eclectic mix of bars, restaurants
and shops.
Major occupiers within the immediate vicinity include AIG, Aviva, Accenture, M&G
Investments, Royal London and Zurich Insurance.
06 07
MOORGATE Broadgate BRUSHFIELD STREET
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connectivity
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78-79 Leadenhall Street enjoys excellent
RE
UN Market
CH
ET
14 D
16 ALDGATE EAST
SD
UR
15 ITC
connectivity with Aldgate (Metropolitan and Circle
ECH
H
16 12
5
AC
10
GR
line), Tower Hill (Circle and District Line) and
13
ET
RE
8
ALDGATE ST
13 2 15 H
Fenchurch (National rail) stations conveniently
Bank of 3 5 1 IG
11 8 TEH
England 7 A
The Royal 7 3 DG
7 2
9 1 AL
located within close proximity.
Exchange 10
4
BANK
9 LEADENHALL STREET 6 6
9 8 11 18
10
11 4
12 14 In addition, the property is within an 8 minute walk of Liverpool Street
Leadenhall 3
17 EE
T station, providing access to the Elizabeth Line (Crossrail) from 2022. This will
6 Market
12
STR
URC
H
OT ST
R EET further improve connectivity, becoming Europe’s largest high-speed railway
FENCH PRESC
4 infrastructure that will serve London and the South-East.
MONUMENT 5 1 FENCHURCH STREET
Once completed, Crossrail will significantly enhance the accessibility of the
EASTCH
E AP property and enabling an additional 1.5m people to be within 45 minutes from
TOWER HILL
central London. Below are some of the proposed journey times from Liverpool
Street station:
LOWER
TH AMES S
TREET
2
02 02 06 07
WHITECHAPEL FARRINGDON CANARY WHARF BOND STREET
amenities local occupiers local developments
1.
2.
3.
Patch East
Adriatic Bar & Restaurant
The Craft Beer Co.
1.
2.
3.
Accenture
AON
M&G
1. 100 Leadenhall Street
2. Royal Mint Court
3. 1 Undershaft heathrow
08 10 33 60
PADDINGTON
STRATFORD
BOND STREET FARRINGDON
PADDINGTON
LIVERPOOL STREET
HEATHROW
WHITECHAPEL
READING
canary wharf STRATFORD
4. The Jewry 4. Kennedys 4. 50 Fenchurch Street
5. The Alchemist 5. Kirkland & Ellis 5. 55 Gracechurch Street
6. Three Tuns Aldgate 6. Royal London 6. 70
Tower of Gracechurch Street
St Katharine
London Docks
7. Caravaggio 7. Oxford Properties 7. 8 Bishopsgate Bakerloo Metropolitan Piccadilly Central
Circle Northern DLR Jubilee 78-79
8. The Japanese Canteen 8. Swiss RE 8. 40 Leadenhall Street District Overground TfL Hammersmith & City
LEADENHALL STREET
9. Farmer J 9. W.R Berkley 9. One Leadenhall
10. Itsu 10. Willis Towers Watson 10. One Braham
11. Association Coffee 11. Mitsui Sumitomoro 11. 80 Fenchurch Street
12. Costa Coffee 12. Lloyds of London 12. Luminary London ELIZABETH LINE
13. Café Cotto 13. BT
14. Fitness First 14. Blackrock heathrow PADDINGTON BOND STREET FARRINGDON LIVERPOOL STREET WHITECHAPEL canary wharf STRATFORD
15. PureGym 15. Bupa
16. 1Rebel 16. ING
17. Rothschild
18. Aviva
Bakerloo Metropolitan Piccadilly Central
08 Circle Northern DLR Jubilee 09
District Overground TfL Hammersmith & City
local developments
The immediate area has been subject to substantial development activity in recent
years with further investment activity anticipated. A summary of recently completed,
under construction and proposed schemes can be found below:
1 2 3 4 5 6
100 leadenhall st, ec3 royal mint court, EC3 1 undershaft, EC3 50 fenchurch st, EC3 55 GRACECHURCH ST, EC3 70 GRACECHURCH ST, EC3
Owner: Lai Sun Development Owner: Embassy of the People’s Owner: Aroland Holdings Owner: The Clothworkers Owner: Tenacity Group Owner: Cadillac Fairview/
Republic of China Company Stanhope
Description: 823,000 Description: 957,000 Description: 366,000
sq ft of office and retail Description: 470,000 sq sq ft of office and retail Description: 667,000 sq ft of office and retail Description: 600,000
accommodation over 56 floors ft of office, retail & leisure accommodation over 73 floors sq ft of office and retail accommodation over 31 storeys sq ft of office and retail
accommodation over 5.4 acre site accommodation over 36 floors accommodation over 34 floors
Status: Planning permission Status: Planning permission Status: Planning permission
granted Q3 2018 Status: Resubmitted planning granted Q1 2021
granted Q4 2019 Status: Planning permission Status: Planning permission
granted Q2 2020 granted Q1 2021
7 8 9 10 11 12
8 bishopsgate, EC3 40 leadenhall street, EC3 one leadenhall, EC3 one braham, E1 80 Fenchurch st, ec3 LUMINARY LONDON, EC3
Owner: Mitsubishi Estate Owner: M&G Owner: Brookfield Owner: Union Investments Owner: Partners Group / Yard Owner: Crosstree Real Estate
Company / Stanhope Nine Partners
Description: 870,000 sq ft Description: 430,000 sq Description: 328,000 sq ft of
Description: 572,000 sq ft of of office, retail and leisure ft of office, retail, leisure office accommodation over 18 Description: 262,000 Description: 49,000 sq ft of
mixed-use accommodation over accommodation over 34 floors accommodation over 35 floors floors pre-let to BT plc sq ft of office and retail office accommodation over 12
50 floors accommodation over 16 floors floors
Status: Under construction Status: Under construction with Status: Completed Q4 2020
Status: Under construction with with completion expected Q4 completion expected Q4 2024 Status: Completed Q1 2021 Status: Completed Q3 2021
completion expected Q1 2023 2023
10 11
the building restaurant & retail
The property provides a retail unit fronting Leadenhall Street, a busy thoroughfare linking
the City of London with Aldgate. The unit enjoys a prominent 3.93 metre frontage on
the property comprises approximately 15,236 sq ft Leadenhall Street, currently let to Leightons opticians.
The restaurant unit is located in the basement, accessed via Leadenhall Street, and offers
of office and retail accommodation arranged over an expansive unit which is currently occupied by Omnino Steak House.
basement, ground and five upper floors.
The office floorplates are regular in shape and benefit from excellent levels of natural
daylight with glazing to two elevations.
The office specification includes the following:
Contemporary Fan Coil Air two 10 person
reception Conditioning passenger lifts ACCOMMODATION
The measured survey was undertaken by Plowman Craven in accordance with the RICS
Code of Measuring Practice (6th Edition) and comprises the following approximate floor
areas:
Floor Use NIA (sq ft) NIA (SQ M)
floor to ceiling shower excellent 5th Office 1,700 157.9
heights of 2.65m facilities natural light
4th Office 2,155 200.2
3rd Office 2,345 217.9
2nd Office 2,355 218.8
1st Office 2,324 215.9
Ground (part) Office 499 46.4
terraces on raised METAL TILED
4th & 5th floors floors SUSPENDED CEILINGS Ground (part) Retail 1,049 97.5
Basement Restaurant 2,472 229.6
Total 15,236* 1,415.5
* This includes reception area (337 sq ft)
12 13
14 15
Office Retail Terrace
Basement ground floor
FIRST floor (typical) fourth floor
Not to scale. For indicative purposes only.
16 17
tenancy tenure Su
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The property is multi-let to 8 tenants with a WAULT of 5.49 years to expiries The property is held Freehold. (NGL545625).
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or 3.01 years to earliest determination. The office accommodation provides a
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WAULT 4.02 years to expiries or 1.44 years to earliest determination.
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Floor tenant use area lease start break option lease ANNUAL ANNUAL COMMENTS
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(sq ft) (rent review) expiry rent rent (£pa) TR
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5th British Council Office 1,700 11/01/2022 10/01/2023 10/1/2024 £52.08 £88,545 • Outside L&T 1954 Act 40
10
Hall
to
for Offices • Private terrace 32
• Service charge cap of
4
£20,688 linked to RPI Church Yard
PH
• Further tenant break on
2
10/7/2023
4th Oenofuture Office 2,155 11/11/2020 11/11/2024 10/11/2026 £50.22 £108,222 • Outside L&T 1954 Act
Limited • Private terrace St Katharine
• Half rent topped up until Cree Church
10/7/2022
• Service charge cap of
80 78 to 79 77
£27,814 linked to RPI 71 to
• Rent deposit of £32,467
3rd Peek House Office 2,345 1/8/2018 31/7/2023 31/7/2028 £48.74 £114,300 • Inside L&T Act 1954
Management (1/8/2023) • Service charge cap of 16.2m
Limited £33,833 linked to RPI Shelter
• 9 months rent free if 56
tenant break not activated 65 to 68
• Rent deposit of £68,670 69
Harts
Not to scale. For indicative purposes only.
2nd London & Office 2,355 7/11/2018 7/11/2023 6/11/2028 £41.57 £97,900 • Inside L&T Act 1954
International (7/11/2023) • Service charge cap £40,013
Insurance Brokers linked to RPI
ASSET MANAGEMENT OPPORTUNITIES
Association Ltd • 5 months rent free if tenant
break not activated
1st Shipowners Office 2,324 1/5/2018 30/4/2023 £45.21 £105,075 • Outside L&T Act 1954
Claims Bureau • Service charge cap
(UK) Ltd £32,365 linked to RPI
• Rent deposit of £63,156 78-79 Leadenhall Street offers a number of value
Ground
(part)
Satec Srl Office 499 1/1/2021 30/6/2022 31/12/2023 £35.49 £17,710 • Outside L&T Act 1954
• Rent deposit of £5,334
enhancement opportunities as detailed below:
• 3 months rent free if tenant
break not activated
We have not undertaken any initial feasibility studies, however, likely initiatives could
Ground Leightons Retail 1,049 24/3/2017 25/03/2027 23/3/2032 £36.22 £38,000 • Outside L&T Act 1954 include:
Holdings Ltd (25/03/2022) • Rent free topped up until
01/7/2022.
• 5 yearly rent reviews • Refurbishment of existing office • Longer-term potential to increase the
Basement LALR Ltd Restaurant 2,472 9/6/2014 (9/6/2024) 8/6/2039 £21.74 £53,750 • Inside L&T Act 1954 space to provide high quality Grade A buildings Net Internal Area through
• Rent concession topped up
until 29/09/2022
accommodation to drive headline rents additional massing (subject to planning)
• Rent Deposit of £324.15
• 5 yearly rent reviews • Re-gearing of existing leases • Re-configuration of reception space
Total 15,236* £40.92 £623,502
• Attractive sized floorplates to offer a • Enhancement of tenant amenity to
* This includes reception area (337 sq ft)
CAT A+ product include bike storage or additional showers
All the above initiatives will increase the relative attractiveness of the building
and help to create a high level of occupier demand.
18 19further information
planning VAT
The property is located within the City We understand that the property has
of London. The property is not listed and been elected for the purposes of VAT.
not located within a Conservation Area. It is envisaged that the sale will be
structured by way of a Transfer of a
Going Concern (TOGC).
EPC DATAROOM
Further information is available in the Access to the dataroom available upon
dataroom. request.
PROPOSAL
Offers are invited in excess of £11,675,000 (Eleven Million Six Hundred Seventy Five
Thousand Pounds Sterling) for our client’s freehold interest, which reflects a Net
Initial Yield of 5.00% (assuming full purchaser’s costs of 6.80%) and a capital value
of £766 per sq ft. Subject to contract and exclusive of VAT.
CONTACT
For further information or to arrange an inspection of the property, please contact
one of the following:
Will Stebbings Anton McGarvey Oliver Fewtrell
+44 7900 150 186 +44 7725 260 619 +44 7936 338 769
will.stebbings@colliers.com anton.mcgarvey@colliers.com oliver.fewtrell@colliers.com
Colliers gives notice that these particulars are set out as a general outline only for the guidance of intending Purchasers or
Lessees and do not constitute any part of an offer or contract. Details are given without any responsibility and any intending
Purchasers, Lessees or Third Party should not rely on them as statements or representations of fact, but must satisfy
themselves by inspection or otherwise as to the correctness of each of them. No person employed or engaged by Colliers has
any authority to make any representation or warranty whatsoever in relation to this property. All negotiations are subject to
contract. April 2022.You can also read
