8 Lloyds Avenue, EC3

Newton Perkins were asked by Columbia Threadneedle to report on value and the prospects for the sale of 8 Lloyd’s Avenue in the immediate aftermath of Kwasi Kwarteng’s mini budget, which required some careful analysis of challenging property market conditions and a swirl of macro-economic uncertainty. It was clear that values had already taken a hit as a consequence of successive increases in Base Rate from the beginning of 2022, especially for short income secondary office stock. On top of that, statutory requirements to meet higher EPC standards were forcing landlords and tenants to reconsider the value of secondary office stock to them.  

In their own words, our report and recommendations made uncomfortable reading but they accepted our recommendations to market the building at an unproven value below market and below their own internal valuation. With a completion target of the year end, we were able to narrow a strong field of bidders at a good pace with one standout party making all the right noises in terms of availability of equity and timing. Once Heads of Terms had been agreed at marginally under quote, completion went ahead as planned just before Christmas at £11.40m (4.75% on actual income and £610psf), net of vendor rental guarantees.