In January 2015 we announced the sale of the 32,600 sq.ft property tenanted by the O2 Academy in Birmingham. Having acquired the property in late 2012 for £2.15m, it was sold 27 months later for £3.155m.
The sale delivered our clients a total return of c60% in just over two years, and an IRR of c24% p.a. This far exceeded the targeted return at the time of the investment and delivered an exit three years ahead of schedule. As with all of our investments, clients are able to invest in multiples of £25,000; in this instance each £25,000 invested returned almost £40,000. Our clients invested £1.3m of equity in Oct 2012 as part of a fully managed syndicate with a bank debt package provided by Santander. We acquired the property at an attractive price reflecting a NIY of 7.4%, a lease running until 2034 and a full parent company guarantee from FTSE100 Compass Group plc. The O2 Academy is one of the Midlands’ best known live music establishments and comprises three venues under one roof with a capacity for 3800 people.
As with all of our real estate investments we acted in conjunction with Riverside Capital, our long standing property partners who sourced and managed the off-market transaction.