Office Investment: Griffin House Offices, Crawley, UK

– Client Property (SIPS)
– Purchase (Oct 2016): £6.60m
– Sale (Jul 2019): £8.23m
– Total Net Profit: £2.04m
– Hold Period: 2.9 years
– IRR: 10% (unlevered)

We acquired this multi-let office building in Crawley, West Sussex, on behalf of Shipbuilding Industries Pension Scheme (SIPS) in October 2016 at a yield of 7.7%.

At the time of purchase the property was fully let with a low average passing rent of £16.99 per ft2. Following our purchase we refurbished a suite which had become vacant (as expected at purchase) and renewed three further leases, thereby driving headline rents on those units higher by 47% from c.£14.60 per ft2 to £21.50 per ft2.

The building was brought to market mid-Q1 2019 and sold in July at a price reflecting a 25% capital uplift from purchase, having increased the average rent by 17% to £19.90 per ft2.. The annual IRR (ungeared) earned by our client net after fees was 10.0%.