L&G IN RECORD ABERDEEN OFFICE DEAL

Legal & General Property (LGP), on behalf of its annuity fund, announces that it has purchased and forward funded the development of a 335,000 sq ft Headquarters office for Aker Solutions in Aberdeen for a total consideration of over £127 million, equating to a 5.75% net initial yield.  

Representing the largest single office deal ever to take place in Aberdeen, the property forms the first phase of Aberdeen International Business Park which is being developed by the Abstract Group on behalf of Norwegian Investment Company, Aker ASA.  

With works nearly complete, the first phase comprises three interlinked buildings totalling 336,369 sq ft (net) of Grade A office accommodation, alongside 1,197 car parking spaces.  Taking the property on a 20-year, lease term, with options to extend the leases over three further five year periods, Aker is due to take occupation of the asset in February 2015.  Paying an annual rent of just under £7.74 million, with a headline rent equating to £23.75 per sq ft and RPI linked rent reviews, the letting to Aker is believed to be the largest ever single office letting to take place in Scotland. 

With consent for total of around 1 million sq ft of accommodation, further phases are expected to include a series of office buildings and at least one hotel.  The property is located immediately opposite the entrance to Aberdeen Airport on Dyce Drive, approximately six miles to the north west of Aberdeen City Centre.  The strategic importance of the Dyce Airport location is further highlighted by the start of works to the long awaited Aberdeen Western Periphery Route (AWPR) and the associated Link Road between the AWPR and the Airport. 

Aker Solutions is one of the largest employers in Aberdeen, with operations spread across a number of sites in the City. When fully occupied, there will be around 2,400 employees in this new complex.  With a tight supply of skilled employees in the Aberdeen market, the first phase of the development is focused around providing a full-offer environment for employees, to include a good range of catering facilities, as well as a gym and sports hall, two squash courts, a medical centre, retail and a nursery / crèche.  Also recognising the growth of internet shopping, the building offers dried, chilled and freezer rooms for delivery of groceries to the workplace.  

Designed to achieve a BREEAM Excellent rating and targeting an EPC Rating of B, the property comprises a number of high sustainability credentials. 

Commenting on the sale, Mark Glatman, Chief Executive of the Abstract Group, said:
“This purchase by Legal & General is a huge endorsement of the Aberdeen market and this development in particular. When completed, this building will offer the best quality and most environmentally friendly accommodation in Aberdeen.”

Adam Kerr, Head of long income transactions at Legal & General Property, commented:
“Abstract has a reputation for delivering buildings of high specification, with excellent green credentials, to an exceptional standard of finish and this development project goes above and beyond this.  Investing for the long term, in order to provide a secure, long term income to match our annuity liabilities, the quality and enduring appeal of this building as a key business location is vital, as is the strength of the covenant backing it.”

Laura Mason, Director of Direct Investments at Legal & General Capital, said:
“This investment demonstrates our continued commitment to move into direct investments in the UK using our internal capital sources to provide long term financing to many different sectors.” 

For further information, please contact:

Olivia Goodall
PR Manager, Legal & General Property
020 3124 2777

Mark Glatman
Abstract Group of Companies
+44 (0) 207 747 8272 
www.aibp.co.uk 

Legal & General Property:

Legal & General Property (LGP) is a wholly-owned subsidiary of Legal & General Investment Management (LGIM), one of Europe’s largest institutional asset managers and a major global investor. LGIM manages approximately £465bn in assets on behalf of over 3,100 clients (30 June 2014) and provides products and solutions spanning all asset classes. LGP is the fourth largest institutional property fund manager in the UK, managing or co-managing 17 separate funds or vehicles including three segregated mandates with an aggregate asset value of £14.2bn as at 30 June 2014. These funds include:

• Balanced Funds

  • Life Fund; Linked Pensions; Linked Life; Managed Fund; Legal & General UK Property Fund; UK Property Income Fund I; UK Property Income Fund II; LPI Income Property Fund and the Hybrid Property Fund

• Specialist Pooled Funds

  • The Leisure Fund Limited Partnership; Industrial Property Investment Fund; Arlington Business Parks Partnership; and the English Cities Fund

• Single Asset Vehicles

  • Bracknell Regeneration Partnership; Central Saint Giles Partnership.

LGP’s UK-focused fund management platform has built and retained a strong track record of out-performance. Owing to its size, diversity and penetration, it benefits from best-in-class banking and property contacts which, along with its wealth of in-house skill and expertise, have enabled it to continue to attract and secure high quality market opportunities. 

Taking a client-centric approach, the business places the highest priority upon integrity and transparency, leveraging the significant resources provided by the wider LGIM platform.  Protecting the medium to long term value of its portfolio, as a leader in sustainability, green principles are embedded into every property and investment decision. 

Sector specialists cover each sphere of the market and are supported by LGP’s market-leading research capability. In particular, the Company has a major development platform, responsible for delivering community-focused projects ranging from West End landmark buildings to significant town-centre retail and leisure regeneration schemes. 

Forming part of the Group’s larger UK housing and infrastructure investment strategy, LGP also continues to participate in a growing range of supply side housing activities, including financing affordable homes, the house building sector, urban regeneration, student accommodation and care homes.  

ABSTRACT STARTS ON SITE AT GATWICK

Abstract (Crawley) Ltd – a wholly-owned subsidiary of Mark Glatman’s Abstract Securities – has announced that on-site construction works have commenced for its next highly competitive speculative office development, 'The Leonardo Building’, Manor Royal, south of Gatwick Airport.

Abstract have appointed main contractor, Bowmer & Kirkland, who started construction in early October. It is estimated that the development will create approximately 150 construction jobs. The property will have an end investment value of £45m and be able to accommodate up to 1,700 staff when it completes during the last quarter of 2015.

The Leonardo Building is a ‘Grade A’ office building comprising 110,000 sq ft together with over 300 car parking spaces. The site is the last undeveloped plot at Crawley Business Quarter just South of Gatwick Airport and opposite the offices of Virgin Atlantic and Boeing. Other nearby occupiers include Doosan Power Systems, Tui Travel plc, Thales and Elekta.

The scheme will comprise a TP Bennett design of four floors offering flexible, virtually column free floor plates each of circa 28,000 sq ft.

In line with all Abstract developments, the building will target a BREEAM 'Excellent' standard and an EPC ‘B’ Rating together with a building design occupancy from 1 person per 6 sq m which will maximise the operational efficiency of the accommodation.

Mark Glatman, Chief Executive of Abstract Securities, said: “The proposals for a second runway at Gatwick Airport are gathering momentum, and three quarters of a million sq ft of office space sits on land that will be blighted by current plans whether or not a decision is made swiftly.

“The Leonardo Building sits outside the proposed land take for the airport and offers occupiers absolute certainty in terms of their business needs and an opportunity to secure great quality new offices in a location which is unaffected. Our building is competitively better now and offers a total solution irrespective of the future plans for a second runway at Gatwick Airport.”

Abstract’s Development Director, Christopher McPherson, said “It’s excellent news that we have started on site so quickly after having achieved planning consent. With rents from just £23 per sq ft the Leonardo Building offers occupier friendly, highly cost effective and environmentally efficient space at rental levels below that being achieved for second hand space in the locality, without any compromise on Grade A quality. The accommodation has been designed to be very flexible and will appeal to a wide range of potential end users.’’

The building is one of several speculative office developments that Abstract Securities has recently undertaken across the UK.

Having completed the 100,000 sq ft ‘Renaissance’ development in Croydon in November 2013, which was fully let within 10 months, Abstract is currently on site in Glasgow where it is in the final stages of speculatively building the 170,000 sq ft ‘St Vincent Plaza’ office development, which will complete in Spring 2015.

In conjunction with Aker ASA, Abstract is also currently developing 1 million sq ft of offices at Aberdeen International Business Park, where the first phase of 335,000 sq ft is due to complete in February 2015 and where the biggest office letting ever in Scotland has just been announced.

Agents for The Leonardo Building are Knight Frank, Savills and Stiles Harold Williams. For more information visit www.theleonardobuilding.com

CGI shows: The Leonardo Building, Crawley

-Ends-

For media information, please contact
Pauline Gregory on 07833 490964 / pauline@skylarkpublicrelations.com
Lisa Mennie 07825 225 414 / lisa@skylarkpublicrelations.com

ABSTRACT WINS COSTAR AWARD

RENAISSANCE CROYDON – 100,000 SQ FT OFFICES FULLY LET

Legal and professional services organisation Parabis has leased the remaining office space in the Renaissance office development in Croydon comprising the ground and third floors and totalling 37,125 sq ft.

The news follows the announcement in May that Mott MacDonald, have taken 20,997 sq ft, comprising the entire fourth floor.

Parabis and Mott Macdonald join The Board of the Pension Protection Fund who took 40,241 sq ft in the building in May 2013.

Renaissance, the first speculative office in Croydon for around 20 years, was completed in November 2013 by Mark Glatman’s Abstract Securities who sold the office development in Dingwall Road, three months ahead of completion, but retained a marketing role working closely with the new owners, M&G Real Estate.

Abstract’s Development Director, Christopher McPherson, commented: “Renaissance has been a success story for Croydon and for Abstract. We not only identified an opportunity at a time where others doubted the potential, but we moved swiftly to invest and to deliver a great product which is completely in tune with occupier sentiment as evidenced by fully letting 100,000 sq ft of offices within 10 months of completion.’’

Mark Glatman said: ‘’The success of our Croydon scheme vindicates our ‘uncompromising value’ approach to development and, with the same rationale being adopted at our St Vincent Plaza scheme in Glasgow and Leonardo scheme near Gatwick, we remain optimistic. These schemes offer the most cost effective new build Grade A office space in the UK bar none and, together with good environmental credentials, low running costs and efficient densities of occupation, will be significantly more economical to occupy than most older offices – tenants can actually save money by moving into a brand new Abstract building’’.

Renaissance provides 100,000 sq. ft. of 'Grade A' office accommodation comprising five floors offering flexible floor plates of 20,000 sq. ft. The building is one of the first speculative builds in the UK to achieve a BREEAM (2011) 'Excellent' standard and recently won a national award for Sustainable Achievement.

Knight Frank and Sinclair Clark are retained in a letting capacity.

For more information, please contact:

Mark Glatman
T: 0207 747 8272
E: mark.glatman@abstractsecurities.com

Christopher McPherson
T: 020 7747 8282
E: christopher.mcpherson@abstractsecurtiies.com

AKER SOLUTIONS TO LEASE 335,000 SQ FT AT ABERDEEN INTERNATIONAL BUSINESS PARK

Abstract has confirmed that it has concluded an agreement for lease with Aker Solutions ASA to take the whole of the First Phase of the Aberdeen International Business Park comprising 3 interlinked buildings totalling 335,000 sq ft. It is believed that this is the largest office leasing deal ever in Scotland.

Abstract via a special purpose vehicle, Abstract (Cornwall) Ltd is developing the Aberdeen International Business Park on behalf of Aker ASA (the listed Norwegian Investment Company). The Business Park comprises a 40 acre site opposite the entrance to Aberdeen International Airport. When completed the Business Park will comprise of approximately 1,000,000 sq ft of offices and is likely to include at least one hotel.

The first phase of the development comprising 3 interlinked buildings with supporting infrastructure and parking for approximately 1,200 cars will be occupied by global oil services company, Aker Solutions, from completion in February 2015. The buildings are designed to accommodate around 2,400 employees and besides a variety of catering options, the first phase also includes a gym, a sports hall, 2 squash courts, a medical facility, a nursery/crèche and a shop. The buildings are designed to achieve BREAAM Excellent 2011 - EPC ‘B’ and will offer the highest specification of any offices in the Aberdeen market.

Aker Solutions will be taking 20 year RPI leases on each of the 3 buildings with a combined rent role of approximately £7.74 million per annum. There will be an option to extend the leases for 3 further 5 year terms. The headline rent equates to £23.75 per sq ft.

Now that this letting is concluded, Abstract will be looking to bring forward the next phases of the Business Park at an early stage. Plans are currently under development for the next office building as well as the hotel.

Welcoming Aker Solutions Mark Glatman of Abstract commented “the position of the Aberdeen International Business Park adjacent to Aberdeen International Airport, the quality of the development and the developing local road infrastructure makes this Business Park an obvious and logical location for major international companies active in the Aberdeen Market. The facilities available to Aker Solutions staff within their buildings will be on a level with the very best of any office anywhere in the UK”.

For further information contact:
Mark Glatman, Abstract Group of Companies

T: 0207 747 8272
www.aibp.co.uk