Oxford Properties and Singapore’s Temasek has signed an agreement to buy the 497,021 sq ft Blue Fin Building on London’s South Bank from a subsidiary of Time Inc. for £415m, with senior finance lined from HSBC.
The joint venture deal is expected to close by the end of the fourth quarter of 2015.
While the joint venture partners declined to comment on the financing, CoStar News understands that HSBC has won the finanicng mandate to provide an almost £230m five-year senior loan, priced at between 130 to 140 basis points over three-month Libor.
HSBC also declined to comment on the anticipated senior loan, which relfects a circa 55% LTV.
The Blue Fin Building is 100% leased, with Time Inc. UK remaining as the majority occupier under a lease back of 160,000 sq ft, and the balance being multi-let to 12 occupiers. Time Inc. has occupied the site since 2007 when the building was originally developed.
Paul Brundage, Executive Vice President and Senior Managing Director, Oxford Properties Europe, said: “The Blue Fin Building is an iconic asset located in the heart of London’s vibrant South Bank district and is a great addition to Oxford’s European portfolio, which now stands at over C$7bn in assets under management in London and Paris.
“This transaction reinforces Oxford’s belief that specific emerging ‘live-work-play’destinations will outperform over time as a result of infrastructure improvements and shifting occupier dynamics.
“We are excited to enter into this transaction with Time Inc. and look forward to building a strong relationship with them in the years ahead as an important occupier and customer. This transaction represents the second joint venture in London with our partner Temasek as we look to build on our successful partnership at MidCity Place, London.”
Time Inc. Executive Vice President Jeff Bairstow commented: “We are very pleased with the outcome of this transaction. It’s logical for us to monetize this valuable asset and place it in the hands of professional investors with proven track records.
“As part of the sale, we will lease back space at the Blue Fin Building and it will remain our UK headquarters. Since Time Inc. became an independent US public company in 2014, Time Inc. UK has invested in expanding its brands, content and audiences into new revenues streams, through a combination of organic investment and acquisition.
“These investments allow us to more effectively fulfil consumer passions with targeted content, products and services; as well as serve the advertisers who wish to reach them.”
Eastdil Secured advised on the sale.