Derwent London has exchanged contracts with a local government pension scheme to sell Francis Houses in London for £55.5m.
The sale price for the building at 11 Francis Steet, which comprises 43,000 sq ft of office space and a 9,000 sq ft basement, is less a £1.3m surrender premium in relation to the basement space, and reflects a net initial yield of 4.9%. The sale is scheduled to complete in early Q4 2025.
The former Army & Navy store was comprehensively refurbished in 2022 and global PR firm Edelman pre-let the space on a 15-year lease – with a break at year 10 – at a headline rent of £76/sq ft.
Paul Williams, chief executive of Derwent London, said: “We are seeing improved investment liquidity across the London office market and today’s disposal highlights strengthening investor demand. With £215m of sales completed or contracted to complete in 2025, we will reinvest the proceeds into a range of higher returning opportunities, including our three near-term West End projects totalling 500,000 sq ft and potential acquisitions.”
Colliers Global Investors was advised by Colliers and Browne Jacobson, Derwent London was advised by CBRE and Charles Russell Speechlys.
