Kennedy Wilson pays c€72m for southern UK office campus
New York listed Kennedy Wilson has paid $81 million (€72 million) for a five-building office campus on the UK’s south coast.
Known as Forum, the asset is located midway between Hampshire cities Southampton and Portsmouth, and comprises 252,000 sq ft (23,412 sq m) of office space on a 30-acre site.
Mike Pegler, Kennedy Wilson’s head of UK, said, “we acquired Forum below replacement cost, and the transaction represents a secure initial income stream for Kennedy Wilson with further upside potential as we implement our capital and asset management programs to improve the tenant experience and enhance sustainability credentials onsite.”
Tenants include HSBC and Specsavers and there is a weighted average lease term to first break of 4.2 years.
The acquisition was completed at a 6.3% cap rate with 85% occupancy and, following the lease up of the vacant space, the yield on cost is projected to grow to over 9%, Kennedy Wilson said in a statement.
There is a vacant 11-acre development plot adjacent to the site with approval for a mixed-use development including light industrial space.
Forum was developed between 2001 and 2007 as part of the Solent Business Park which is a mixed-use project that includes over 1 million sq ft of offices on 130 acres.