Braemar ground rent fund buys Beetham Tower freehold

Michael Hunt

Hale-based property fund manager Braemar Group, listed on the AIM stock exchange, has announced that its Ground Rents Fund has purchased the ground rent of the Beetham Tower in central Manchester.

Braemar, which listed its Ground Rents Open Ended Investment Company on the Channel Islands Stock Exchange a year ago, said the deal represents a net initial yield of 6.25%.

James Agar, director of business development, said: "I am delighted to be able to announce the Fund's acquisition of the Beetham Freehold, which is one of the best known buildings in Manchester. It is a perfect example of the type of large scale, well located developments which the fund aims to acquire.

"I expect this to be the first of several significant freehold purchases, which the fund hopes to complete during the course of the next year, driving further performance of Net Asset Value as the fund continues to provide investors with exposure to this asset class."

Braemar said as an Open Ended Investment Company, this fund continues to take in new subscriptions on its monthly dealing days. The company added that the Open Ended Investment Company benefits from monthly liquidity and it is suitable for investment by offshore bonds, pensions, trusts, companies and individuals.

Braemar said ground rents are amongst the most stable and predictable form of property income and that the fund already owns freeholds to 247 other apartments in Birmingham, Bristol and Yorkshire on a blended yield of 7%.

Ground rent is a regular payment required under a lease from the owner of leasehold property, which is payable to the freeholder. Ground rent is created when a freehold piece of land or when a house, apartment and commercial unit, is sold on a long lease.

Beetham Tower was designed by Ian Simpson and stands at over 168 metres high and is home to the Hilton Hotel, which takes up the first 23 floors of the building, as well as 219 apartments and 16 penthouses, which are housed on the remainder of the 47 floors.

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