Peterborough City Council has acquired the freehold interest in Sand Martin House in Peterborough, which the council occupies in its entirety, for £47.378m, reflecting a net initial yield of 4.75%.
The 90,017 sq ft BREEAM Very Good building sits on a 5.9-acre site and includes a multi-storey car park and surface parking. The council secured a 25-year lease for the space in 2018, with rent reviewed to RPI every five years.
Ali Rana, head of national investment, commercial, at Carter Jonas, which advised the council on the deal, said: “This acquisition represents a positive investment for the council and the people it serves. The purchase will ensure that the council, which is committed to having its headquarters in the centre of Peterborough, remains in the heart of the city, close to its residents and businesses, whilst having greater control and management over the cost of its accommodation.”
A spokesperson for Peterborough City Council, added: “Following approval by full council last month, we have now completed the purchase of Sand Martin House. Detailed financial modelling showed that the cost to borrow the money to purchase the building was less than the rental costs for the next 20 years and will additionally provide a saving for taxpayers in the next five years. Purchasing the building also gives us full control of the use of the building.”
Knight Frank advised the vendor.
