A historic building on Newcastle Quayside has been snapped up in a £14.5m deal by French investors.
French investment fund Iroko Zen has swooped for Exchange Buildings, a prime property overlooking the River Tyne which was built around 1860.
The building - which incorporates 9-15 Lombard Street, 9 Quayside,16 Queen Street and 6-10 King Street – is let to leisure tenants which include Premier Inn Hotels, Spirit Group Retail and Stonegate Pub Company, which operates the Slug & Lettuce bar and restaurant from the site.
The off-market deal for the freehold was overseen by property consultancy Knight Frank and represents a net initial yield of 7.42% and total rent is £1,152,478 per year. Premier Inn accounts for 75% of the rent and the hotel rent is reviewed five-yearly linked to CPI.
Francesca Sidoli, in Knight Frank’s operational long income team alongside Richard Stewart in the European Team represented the purchaser, Iroko Zen. Robert Irving Burns represented the vendor, United Property Services, on the transaction.
Partner at Knight Frank in Newcastle, Dickon Wood, said: “This acquisition highlights continued foreign investor appetite for Ƶ real estate in the regional cities. It reflects a growing trend among investors to diversify away from saturated urban centres and seek higher returns.”
