Carlyle buys Salford site for £30m JV with Abstract Nikal

Global private equity firm the Carlyle Group has made its second investment in the Manchester area, buying an 8.42-acre site in Salford Quays from Colgate for an undisclosed sum.

Carlyale has joined with Nick Payne and Alan Murphy's Manchester-based Nikal and ex-Akeler chief Mark Glatman's Abstract to form a three-way joint venture to redevelop the site.

The site, next to the large Exchange Quays office buildings, was originally used by Colgate for toothpaste and deodorant production and includes a 440,000 sq ft building with offices, cleared production and warehouse space as well as approximately 500 car parking spaces.

The buyers said it is one of the largest sites available in the regeneration area of Salford Quays and lies within the area designated Media City UK area.

Early plans for the site feature office refurbishment with floorplates of 90,000 sq ft, a data centre, media use and hotel space. Canning O'Neill and Cushman & Wakefield have already been appointed as agents for the scheme.

Talks with Salford City Council and Central Salford urban regeneration company are ongoing.

Separately Abstract and Nikal have formed a joint venture which has acquired several freehold ground rents on adjoining sites as a long-term investment for its own benefit.

This is Carlyle's second development in the Manchester area. Last year it acquired office developments, Three and Four Piccadilly Place, in Manchester city centre from Argent.

Robert Hodges, managing director of the Carlyle Group, said: "This acquisition takes advantage of our strong equity base to deliver potential for long term value through an opportunistic investment approach. We hope to be able to announce more such acquisitions in the UK and Europe in the coming months.

"We are strong believers in the future development of the Manchester area as a vibrant business centre and believe that this site will benefit considerably from the regeneration and inward investment interest that is focusing on the Salford area. Importantly, the space that we have acquired is large and flexible enough for us to consider attracting a range of occupiers both local and from further afield, looking for affordable, quality space built to meet their needs."

Glatman, chief executive of Abstract, added: "This site is incredibly prominent and well-located. The existing buildings will lend themselves well to the provision of highly competitive short-term accommodation and the site offers huge development potential in the longer term."

Payne, managing director of Nikal, added: "This is a hugely significant purchase based upon a strategy of providing one of the largest single office refurbishments in Manchester. The building is unique as it is of modern design and offers floor plates of 90,000 sq ft. Once upgraded, the building will provide highly competitive office accommodation in a market that will seek quality and good value for money."

The Manchester office of Cushman & Wakefield represented Colgate.