Two fund managers have paid £78m in separate purchases for two office blocks at Manchester’s Spinningfields development.
Hansa Invest has bought 2 Hardman Street from Legal & General’s UK Property Unit Trust for £57m, equivalent to a 6.75% yield.
bp Pension Fund has bought 4 Hardman Square from Aviva Investors Property Fund for £21m, a 6.95% yield.
BP Pension Fund paid cash and Hansa, the fund management arm of German insurance group Signal Iduna, paid mostly cash but used a small element of debt.
Legal & General and Aviva are understood to have sold to increase liquidity within their funds. The buildings were expected to perform well – despite the market – because they are fully let and within Allied London’s Spinningfields scheme.
The 157,364 sq ft 2 Hardman Street office block is let to Greater Manchester Newspapers, part of the Guardian Media Group, and Deloitte.
Grant Thornton and HSBC occupy 4 Hardman Square, a 53,000 sq ft office block. Aviva bought the building, along with 3 Hardman Square, for £140m from Allied London in September 2006.
Investment yields in Manchester are now believed to lie around 7%.