£57m Wardrobe Court deal agreed

British Land is buying Wardrobe Court, in the City of London for £57m. The deal for the 71,000 sq ft residential investment property, in EC4, represents a capital value of £800 per sq ft.

Wardrobe Court is a Grade II-listed cluster of buildings set around a cobbled courtyard, comprising 92 studio, one, two and three-bedroom serviced flats along with a retail and office unit. It is one of the few surviving early 18th century squares in the City.

Most of the property is let to BridgeStreet, an operator of serviced flats, until December 2014 with rent subject to annual uplifts in line with the retail prices index. The deal represents at purchase, a net initial yield to British Land of 4.7 percent.

British Land has the chance to renew or re-let as serviced flats at a significantly higher rent, or to upgrade and sell-off profitably as private residential properties at the end of the lease.