Last checked at 
(Alliance News) - Derwent London PLC on Thursday said it has agreed to sell its 192,700 square feet freehold interest in Johnson Building, located in central London, to Eurazeo Patrimoine.
The London-based property investment firm said the headline price is GBP170 million before rental top-ups of GBP2.4 million for incentives and vacant space.
Derwent said it bought the office and retail complex in 2000 for GBP29 million, and in 2006 the company completed a refurbishment, which increased the lettable area by 53%.
""The refurbishment of the Johnson Building was one of our first generation of schemes and the sale continues our strategy of disposing of mature assets," said Chief Executive Paul Williams.
The total rent passing from the multi-let buildings is GBP7.3 million per year, with 40% of the income expiring in 2021, the company noted.
The sale price represents a net initial yield of 4.1% on the passing rent, which will fall to 2.5% allowing for 2021 lease expires. The disposal price, net of incentives, is 4% below the June book value before costs, Derwent noted.
"The proceeds will be reinvested into new developments with superior growth prospects, such as 19-35 Baker Street W1 which is scheduled to start on site in 2021," added Williams.
In a separate statement, Derwent said TransferWise has agreed to extend and expand its occupation at the Tea Building in Shoreditch, London.
TransferWise currently occupies 31,700 square feet on a lease due to expire in December 2023, with a tenant break in May 2021 and has committed to a new five-year lease on 48,950 square feet, an increase of 54%.
The FTSE 250 stock was trading 0.4% lower in London on Thursday at 3,152.00 pence a share. So far in 2020, Derwent shares are down 21%.
By Evelina Grecenko; evelinagrecenko@alliancenews.com
Copyright 2020 Alliance News Limited. All Rights Reserved.
