Hadrian's Tower, the tallest building in Newcastle, has been purchased in a multi-million-pound transaction. The Australian investment firm L1 Capital acquired the building, which was listed for sale last year with a price tag of £14.6m.
The 27-storey residential tower, which opened its doors in 2020, houses 159 flats, 57 of which remained unsold when the property was put up for sale last year. It was developed by High Street Group, which went into administration in 2022 owing over £200m.
Prior to its downfall, High Street Group was one of the North East's most notable developers, spearheading plans to develop a site near St James' Park that now accommodates the Stack site, as well as a proposed housing development on the former Brett Oils site along the Tyne in Gateshead. Both projects were taken over by other firms following the collapse of the High Street Group.
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Hadrian's Tower was its most significant development, standing out on the city centre skyline and offering sweeping views across the city. In addition to its 159 luxury apartments, it features a rooftop champagne bar and restaurant, and residents have access to a dedicated lounge and concierge services.
L1 Capital, established in 2007 with offices in Melbourne, Sydney, London, and Miami, has purchased the tower. The acquisition of Hadrian's Tower "forms part of L1 Capital's 海角视频 residential strategy, targeting high-quality assets with mid-market rents", according to the company, reports .
David Lamm, CEO of L1 Property, said: "Hadrian's Tower is a great addition to our residential portfolio. It is a high-quality property providing strong levels of income in an exciting regional city.
"Newcastle has attractive fundamentals, enabling us to capture reversion on both an asset and market level. We're delighted to have completed on this complex acquisition and look forward to actively managing it over the years ahead."
James Wilson, partner at Allsop, said: "The sale of Hadrian's Tower demonstrates the continued appeal of high-quality, income-generating residential assets in strong regional centres. With its prime location, diversified income profile and long-term potential, the building attracted significant interest.
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"While the transaction involved a number of complexities, we're pleased to have supported FRP Advisory in navigating the process through to the successful completion of this deal."
Although the price of the transaction remains undisclosed, last year's announcement of a £14.6m price tag represented a substantial decrease from the £40m development cost advertised at the project's inception in 2018. L1 Capital alluded to securing a favourable purchase, stating that it acquired the property at "a meaningful discount to replacement cost".
Advertising material for the tower last year outlined rental income from the top-floor 3Sixty’ bar, plus a mixture of rent and lease agreements on 157 apartments. It said the property would produce a total annual income of just over £1.3m.
Hadrian's Tower, constructed by the now-defunct Gateshead construction firm Tolent, which went into administration in 2023 resulting in a loss of 300 jobs. The significant losses on the Milburngate scheme in Durham were identified as a key factor in Tolent's downfall.
James Wilson at Allsop acted as the selling agent on behalf of joint administrators Nedim Ailyan and Ben Stanyon at FRP Advisory. Squire Patton Boggs represented the vendor, with L1 Capital receiving advice from David Kanter and Daniel Lipman of Mishcon de Reya.