DWS, formerly Deutsche Asset & Wealth Management, has sold Norfolk House in Manchester city centre to Knight Frank Investment Management for £19.1m, in a deal reflecting a net initial yield of 6.02%.
The building on Norfolk Street comprises nearly 56,000 sq ft of offices over five floors. Current occupiers include Zurich Insurance, GVA, and Euler Hermes. Around 10,000 sq ft is still available, split over parts of the first and third floors.
Gerald Eve advised KFIM on the deal, while DWS was advised by CBRE. KFIM has acquired the building on a freehold basis. CBRE are also the retained agents for the building, alongside OBI.
The building was purchased by Deutsche Asset & Wealth Management in 2015 from M&G at a cost of £16.8m, reflecting a yield of 6.62%.
David Johnson, partner at KFIM, said: “Manchester is a core regional office market that we have been keen to invest in for some time, after considering a number of assets we are delighted to have secured Norfolk House. The building profile offers the fund both core income secured to a number of recognised strong covenants as well as some void providing the opportunity to develop and improve the rental tone in the building.
“There have been a number of successful developments close by and the imminent opening of the old Stock Exchange Building opposite will further improve the appeal of this location”
Leo Nicholson, senior associate at Gerald Eve, said: “Offering significant reversionary potential and numerous asset management angles, Norfolk House is an excellent acquisition for KFIM. Manchester is an essential location for both national businesses and leading international companies, and Norfolk House is well-placed to capitalise on the strong market dynamics.”