Aviva Investors has agreed a forward funding deal to acquire the freehold interest on Kier Property’s 85,000 sq ft office development at 11 York Street in Manchester.
Aviva has bought the building for an undisclosed fee, and will now work in partnership with Kier to deliver 79,000 sq ft of Grade A office space on the site, formerly home to Oddfellows House.
Office floorplates will be between 10,200 sq ft and 11,700 sq ft, and the building will also have two ground floor retail and leisure units of 5,300 sq ft each, along with 23 basement car parking spaces.
Demolition work has started on site, and the project is due to complete in the fourth quarter of 2019. OBI represented Aviva Investors on the deal, while Kier was represented by CBRE.
Designed by AHR Architects, the office is being developed speculatively, but is on the shortlist of a number of occupiers, including law firm Eversheds, which has a requirement of between 40,000 sq ft and 50,000 sq ft.
Kier Property first bought the site from Aberdeen Asset Management in November 2016. The company also completed a sale and leaseback deal with investor Aprirose on 81 Fountain Street, only metres away, in 2016.
The office is now home to Kier’s finance division.
The acquisition of 11 York Street adds to Aviva’s portfolio in central Manchester, which includes 201 Deansgate and 55 Spring Gardens, both of which were purchased last year. The investor also owns the Corn Exchange and the recently-refurbished 11 Portland Street.
Christian Anderton, associate director at Aviva Investors, commented: “York Street will represent our best specified office asset in Manchester and adds to a strong portfolio of space diversified by location and price point.
“Manchester, which is characterised by a lack of new Grade A stock being delivered locally, forms a major part of our targeted cluster investment strategy.
“The marketing campaign for the scheme will launch imminently and break new ground in the viewing experience, enhanced by the building’s vertical design and resident lifestyle proposition.”
Will Lewis of OBI said: “Eleven York Street is the only Grade A office building to be developed in the central core of Manchester since the last cycle.
“We have carefully considered the development pipeline and due to its location and with diminishing levels of prime Grade A space, we are perfectly placed to secure those occupiers looking for best in class accommodation and a long-term partner in Aviva Investors.”