Southwark Council has completed the purchase of its own headquarters at 160 Tooley Street for £170m, as revealed by Propertyweek.com.
The council has bought the high profile office building from HSBC Private Bank for £170m – £20m over the asking price – reflecting a net initial yet of 4.25%.
The council, advised by GVA, beat interest from overseas investment funds for the 205,236 sq ft building, which was put up for sale through agent Whitmarsh Holt Young in November.
A report for the council cabinet outlines the rational for buying the building, which is being paid for using the council’s internal funds.
“We currently pay £7.7m each year in rent on our council headquarters at 160 Tooley Street, and this figure is likely to increase through rent reviews,” the report said. “The terms of our lease continue to 2033, without a break clause.
Tony Joyce, regional senior director at GVA, said: “Our City agency team and Neil Dovey of our investment team worked together to secure a major transaction in just seven days. If there is a willingness on both sides, large scale transactions do not have to get bogged down in red tape. Southwark Council is a forward looking authority with the ability to make rapid, sensible decisions, which was reflected in the nature of this purchase.”