Craigard buys Bordage House
BORDAGE House in St Peter Port has been purchased for £3.7m. by commercial property specialist Craigard in its first offshore deal.
The building comprises 12,207sq. ft of quality office accommodation, plus a small boutique retail unit on the ground floor, with the price paid representing a 7.5% initial yield.
‘Using our extensive knowledge of commercial property, built up over many years in the sector, we invested in Guernsey after a lot of thought and research on the office market and the island’s economy,’ said Paul Foster director of Craigard.
‘We have bought a decent building that accommodates sustainable local businesses – ones that should carry on a steady business post-Brexit. We also have indexed rent reviews which are easier to manage.’
He added: ‘It’s a smaller investment value than a lot of properties traded in St Peter Port so also appeals to a wider pool of investors. This combined with the lease lengths gives us comfort that it will stay readily saleable for the foreseeable future and thus hopefully rise in real value.
‘Plus Guernsey is a beautiful island, so who wouldn’t want to invest in this location?’
The property has been acquired under the Craigard Select model as it is multi-let to four tenants, including ABN Amro Bank, all on long leases. The weighted average unexpired lease term is over nine years – a very attractive offer given that that there are also three-year RPI rent reviews. There is a small ground floor suite.
The building was completely rebuilt behind the original façade in the late 1990s and the various tenants have invested further money in the last year or two undertaking various improvements and refurbishments.
Mr Foster also said: ‘The pricing at 7.5% is also very favourable compared to a similar building in say Southampton where the investment yield would be probably around 6% - about 25% more expensive in value terms.
‘We analysed in detail the local market and felt comfortable that this would be a good investment for the medium term. Since purchase, we have added £30,000 or so to the income stream by securing a one-year letting of the small ground floor suite. This will be refurbished when we get the space back next year.’
