Carlyle to sell £300m City trophy

Carlyle is to make a second attempt to sell Alban Gate, the prime City property at 125 London Wall, EC2, after a nine-month sales process two years ago ended in the building being withdrawn from the market, opting instead to focus on asset management initiatives.

Carlyle has yet to fix an asking price for Alban Gate, but it is thought the building will fetch more than the price of two years ago given the upward pricing movements in the City market since that time, the broader spectrum of investors targeting London, coupled with lack of stock, and the asset management of the building, notably last year’s letting to law firm Nabarro.

In 2011 Carlyle had been seeking a net initial yield of around 6%, which reflected a lot size of £287.5m, but it is thought at least £300m will be sought when the asset formally comes to market this time around.

Carlyle is also yet to finalise a timetable for the sale, but it will almost certainly wait for after the market’s August slowdown to maximise its impact. That, together with the conclusion of various asset management initiatives at the property, mean that Alban Gate is not likely to be brought to market until September at the earliest.

It is likely that GM Real Estate will be instructed to handle the sale given the agent’s historical role advising Carlyle on the sale previously, as well as on its asset management.

Alban Gate, which has a rent roll of £18.25m, received a fillip in December last year when Nabarro signed to take 138,000 sq ft of offices from JP Morgan Chase at the property. The lawyer’s decision to move ahead of lease expiries in 2014 on the 115,000 sq ft it occupies at 84 Theobald's Road, WC1, was one of the City’s most sought-after requirements. JP Morgan, which has a lease on the building until 2025, is expected to move out within a few years, when it consolidates from various London locations into 20 Bank Street in Docklands, E14.

Carlyle put the 382,000 sq ft Alban Gate up for sale in December 2010, before Brunei Investment Authority, a joint venture between Hines with Samsung Life, and Tishman Speyer made the shortlist of investors bidding to buy it. Carlyle then withdrew the sale of Alban Gate in August 2011 after bids did not reach its price expectations.

Alban Gate was acquired by Carlyle in July 2010 as part of the wider £671m acquisition of the White Tower portfolio, a collection of London assets formerly owned by Simon Halabi.

Alban Gate will join Millenium Bridge House, another high profile City asset which Carlyle instructed Jones Lang LaSalle to sell last month for £86m, 7.75%. the building was also part of the White Tower portfolio, and has planning consent for a 300,000 sq ft hotel.

All parties decline to comment.


Source: James Buckley, CoStar News