David Murray's property arm sells landmark office development for £66.5m

Published on Thursday 7 January 2010 20:44

SIR David Murray's Premier Property Group has sold a landmark development in Glasgow, but has denied any pressure from the bank to dispose of a key asset, writes Terry Murden.

Aberdeen Property Investors, on behalf of the Strathclyde Pension Fund, has bought 141 Bothwell Street, opposite the former headquarters of Scottish Enterprise, for 66.5 million.

When it was under development in 2005, the property had an anticipated end value of 50m. The price will achieve a yield of just under 6 per cent.

PPG, the commercial property investment and development arm of Murray International, signed up blue-chip tenants for the building, including PricewaterhouseCoopers, banking giant HSBC and the law firm McGrigors.

The award-winning Grade A development was completed in February last year. It was the first building in Glasgow to achieve BREEAM Excellent status – a designation reflecting its environmental credentials. Although the completed property was not earmarked for an early disposal, a spokesman said PPG chose to take advantage of an uplift in interest in prime assets and put it on the market.

A marketing campaign was led by DTZ, extending into Europe, the Middle East and Asia.

Andrew Glasgow, director of PPG, said: "This has been a textbook development. We have created a true landmark building and secured a fantastic tenant line-up. The resultant investment has generated an excellent return for the group. I am particularly pleased that the ownership remains within Scotland."

DTZ acted for PPG, while Phil Reid Associates advised Aberdeen Property Investors.

There was some surprise in the sector when Ian Tudhope, the long-standing managing director of PPG, resigned last month. Tudhope, described as Murray's "right-hand man", had been with the company for 23 years. He left amid speculation that the group was seeking a new direction as it attempted to sell parts of its property portfolio to pay debts.

Commenting on the latest deal, a spokesman for PPG said: "This was nothing to do with Lloyds Banking Group."

Its most recent accounts show Murray's property empire was 572m in debt, much of it held by Lloyds.