Gatehouse Bank, a Shariah compliant investment bank based in London, has completed the sale of the Procter & Gamble (P&G) UK headquarters building, in a deal worth GBP33.68 million ($54.12 million).

The sale representing a net initial yield of 7.49 per cent was made to a private Middle Eastern property investor.

It is an excellent return for Gatehouse’s investors, who have benefited from annual returns of 10 per cent during the three year holding period, and an overall 26 per cent return on investment, a bank statement said.

Acquired for GBP31.5 million in December 2009, the Procter & Gamble building was the first property acquisition Gatehouse advised on.

The property occupies a prominent position within one of the leading business parks in the South East of England, providing 109,290 sq ft of Grade A office accommodation over a three-storey office building, along with a separate dedicated building for meetings, training and conferences, and an on-site staff canteen and gym facility.

The property is fully leased to Procter & Gamble until June 2020, with no breaks.

Adam Cavanagh, executive vice president and head of Real Estate said: “Investors are continuing to look for well positioned buildings with a secure, long-term income stream. When acquired, the P&G building typified these criteria; however, now the lease term has fallen below 10 years, selling at this point guarantees the best return to our investors.

“Balancing risk and reward is a key priority for our client base, and the successful sale of this property - which is our second realised investment in the UK and third globally – makes this a particularly significant deal for Gatehouse.”

Knight Frank’s investment team represented Gatehouse Bank plc on both their acquisition in 2009 and the recent sale.

Mike Bowden, partner at Knight Frank said: “Having bought the asset for Gatehouse Bank in 2009 for 8 per cent, their investors have had the benefit of a 10 per cent per annum cash dividend secured against the global covenant of P&G for over three years.”

“The sale figure of almost 7.5 per cent reflects investor confidence in the market for well located south-east offices. Knight Frank is delighted to have been involved in the successful acquisition and disposal of the asset which further strengthens our relationship with Gatehouse Bank,” he added. – TradeArabia News Service