The building at 110 St Vincent Street in the city centre is steeped in history, having been designed by renowned architect James Miller and opened in 1927 as the new head office for The Union Bank of Scotland. Following a merger with the Bank of Scotland in 1955, it became the lender’s chief office in Glasgow.
More recently the building received a major overhaul to provide getting on for 100,000 square feet of modern Grade A office accommodation while retaining the original listed facade and iconic banking hall.
Savills Investment Management, the global property investment manager, said it had completed the sale of the building in an off-market transaction for £48.4m.
With support from Savills, the sale was made to unnamed South Korean clients of Knight Frank Investment Management (KFIM), advised by Knight Frank, the property consultancy.
Duncan Miller, director at Savills Investment Management, said: “The sale of 110 St Vincent Street demonstrates the ongoing appeal of Glasgow’s property market and caps a successful asset management programme during which we added significant value through extending Bank of Scotland’s lease.”
Alex Braithwaite, senior investment manager at KFIM, said: “110 St Vincent Street is a prime asset that offers both longevity of income and strong performance potential. KFIM now manages ten assets on behalf of a broad range of South Korean investors and, notwithstanding the challenges of Brexit, this transaction clearly demonstrates continued confidence in the UK market.
“We continue to seek assets with strong income fundamentals in both the UK and Continental Europe.”
Alex France, associate director at Savills in Glasgow, said: “110 St Vincent Street is one of Glasgow’s most impressive buildings and represented a rare opportunity to acquire an iconic building with a long-standing tenant. Glasgow continues to draw interest from international investors recognising the strong fundamentals of the market and attractive yields on offer”.
John Rae, head of office at Knight Frank Glasgow, added: “The deal for 110 St Vincent Street underlines the resilience of the Glasgow office market, despite an uncertain macro-economic backdrop.
“The city’s fundamentals are strong, with demand continuing to outstrip supply, and it offers a discount relative to other UK regional centres.
“Overseas investors have come to represent a significant portion of the market in recent years and we believe that will remain the case, with interest continually coming in from new sources.”
Lisa Attenborough, partner at Knight Frank Debt Advisory, commented: “The transaction underlines the strength of the UK debt market where, despite the tumultuous political environment, lenders continue to have appetite to fund real estate transactions, particularly in major cities and with solid income profiles.”