A vacant office building in the centre of Cardiff will be demolished to make way for a 706 bed student accommodation scheme following a £8.7m acquisition.
Picton Property Income has sold the vacant Longcross Court office building to Fusion Group, a leading (PBSA) developer.
Fusion will build a 18-storey building which will also include 7,500 sq ft of internal amenities, including a wellbeing studio, juice bar, fitness suite, and landscaped outdoor spaces.
The Longcross development, situated at the junction of Newport and City Road, was granted planning permission for the change of use in September last year.
Fusion is targeting BREEAM Outstanding certification for its student scheme – the highest rating under the Ƶ’s leading sustainability assessment method, awarded to buildings that demonstrate exceptional environmental performance. The development will include renewable energy facilities through air source heat pumps and solar panels.
Property consultancies Knight Frank and Fletcher Morgan advised vendor Picton on its acquisition.
Brodie Berman, senior acquisitions associate at Fusion Group, said: “Cardiff is a thriving city, and we’re excited to bring forward a development that reflects both student expectations and broader shift towards sustainability and design quality. Longcross Court will not only generate a key site in the city, but also create a best-in-class living experience that supports both academic success and personal wellbeing.
"We’re particularly proud to be targeting BREEAM outstanding for this scheme, reinforcing Fusion’s commitment to delivering environmentally responsible developments that lead the sector.”
Picton chief executive Michael Morris said: “This is the third office asset Picton has sold with planning permission secured. These disposals have enabled us to improve portfolio occupancy, allocate capital for investment into the existing portfolio, repay debt and commence our share buyback programme.”
Gareth Watts, an associate at Knight Frank in Cardiff, said: “This transaction is an example of the occupational realignment which is having a profound impact on the property landscape in Cardiff. The market is polarising at pace, with new or recently refurbished buildings generating healthy occupier attention while older buildings requiring significant capital improvements present the opportunity for repurposing, with new accommodation across the living sectors in demand.”
John James of Fletcher Morgan said: “Since Covid the dynamics of the Cardiff office market have changed considerably, with little sustainable demand for city fringe older office buildings. The repurposing of Longcross Court to student accommodation will reinvigorate this part of City Road and Newport Road and will bring many economic benefits.”
Picton has retained an adjoining site comprising a small industrial unit and open storage land used as a car park.
