Downing sells 87,000 sq ft office building in Liverpool for more than £8m

Investor and asset manager M7 Real Estate has acquired Graeme House in Derby Square, close to the city’s Crown Court complex and the Queen Victoria monument. Tony McDonough reports

Graeme House
Graeme House, an office building in Derby Square, Liverpool

 

Property firm Downing has sold an 87,000 sq ft office building in Liverpool city centre for more than £8m.

Investor and asset manager M7 Real Estate has acquired Graeme House in Derby Square, close to the city’s Crown Court complex and the Queen Victoria monument. M7 acted on behalf of M7 Real Estate Investment Partners III (M7 REIP III).

Graeme House comprises 87,002 sq ft of office space and is 92% let to 22 tenants operating across a diverse range of sectors, including The Secretary of State for Communities & Local Government, Reed In Partnership, Keaney & Co Solicitors and New College Manchester .

The property generates around £1.2m of passing rent per annum with a weighted average lease term of 1.9 years. The net initial yield is 13.5%.

Will Hunting, senior acquisitions manager for M7 Real Estate, said: “The acquisition of Graeme House demonstrates M7’s long standing track record in purchasing assets where there is scope to create further value through our multi-let strategy.

“We have identified an opportunity to build on the property’s existing strong offer and to reposition the asset to accommodate a market that has seen a surge in demand for high quality, flexible and small suite office space.

“In addition, the property grows M7 REIP III’s high quality, diversified income stream and presents an opportunity to drive performance through active asset management.”

 

No 1 Old Hall Street in Liverpool city centre

Downing was once Liverpool’s biggest owner of office space but a number of disposals have significantly reduced its stock in the city centre and has focused much more on its large students developments both in Merseyside and across the UK.

However, its head of property management, John Clegg, said the company remained committed to the continued upgrade of nearby No 1 Old Hall Street where it has developed its Flexi-Office concept.

Mr Clegg added: “Downing has been a proud custodian of Graeme House for many years and has invested heavily to upgrade this landmark building to a high standard.

“With the building in great condition and almost fully let, we felt the time was right to see it pass into new hands and look forward to seeing Graeme House continue to thrive under new ownership.”

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