First UK move for fund
Former Stock Exchange building sold in £33m deal
It has bought the building at the corner of Buchanan Street and Nelson Mandela Place from Aberdeen Standard Investments.
The property is fully let to nine tenants, anchored by retailers North Face and Urban Outfitters, which have been trading from the location since 2001. Other tenants include the Scottish division of the NHS, Subway, Carlsberg UK and Absurd Bird.
AEW said the acquisition of the five-storey building provided it with ownership of “one of the most significant and well-positioned retail sites in Scotland”.
Spencer Corkin, director of investments, said: “This is one of the best retail assets in Scotland, reflecting our highly selective acquisition strategy in the UK.
“Buchanan Street is second only to London’s West End in terms of footfall and retail spend, yet it provides a significant prime yield margin. The micro location’s fundamentals remain particularly attractive with almost zero availability and robust occupier demand driving strong rental growth in recent years.”
Christina Ofschonka, fund manager at Europe City Retail, added: “Through this acquisition we have added another high quality asset to the fund portfolio and we have a strong pipeline of further potential investments.
“Over the last 12 months we have expanded the breadth and depth of our investor base with new investors from Italy and the Netherlands, reflecting the strong appetite among institutions for this focused retail strategy.”
AEW was advised by Brodies and Cushman & Wakefield while Aberdeen Standard Investments was advised by Shepherd + Wedderburn and CBRE.