BREDS finances Henderson Park’s London office debut

The real estate fund management firm has sourced a facility financing 65% of the cost of the acquisition plus a capex loan.

Henderson Park, the investment management firm led by former Mount Kellett head of Europe Nick Weber, has secured senior debt from Blackstone Real Estate Debt Strategies (BREDS) to fund its first office investment in London.

The firm has acquired Athene Place at 66 Shoe Lane from Commerz Real, a subsidiary of Germany’s Commerzbank. The purchase price was not disclosed, but it is understood to be around £101 million (€114.4 million).

The transaction has been financed with an acquisition loan providing 65 percent of the cost of the acquisition, while BREDS will also provide future capex financing, Real Estate Capital understands.

Athene Place is a 147,000-square-feet office building in a prime location in London’s Midtown.

Endurance Land, which partnered Henderson Park in the deal, said last November the firms had exchanged contracts to buy the property. According to Endurance Land’s website, the building is held long leasehold at a peppercorn rent with an unexpired term of 135 years, while Deloitte occupies all the office space on a lease that runs until March 2027, paying rent of £38.64 per square foot. The retail space is let to Caffe Nero and Balls Brothers.

The investment will capitalise on strong demand from occupiers looking to locate in this sub-market of London, Henderson Park said, noting that the area has a vacancy rate of below 4 percent.

The deal marks Henderson Park’s 11th investment and its first in the London office market. Athene Place joins a portfolio of hospitality, multifamily, and office assets in London and other Western European capital cities.

“Athene Place is an exceptional building which has already begun to attract interest from tenants and which we believe has huge potential in one of London’s fastest-moving and best-connected sub-markets,” said Nick Weber, founding partner of Henderson Park.

Since Henderson Park launched around two years ago, the firm has pursued a value-add strategy amid a late-cycle European property market.

Weber told Real Estate Capital last December that “some air” had come out of the London offices bubble in the wake of Brexit. “We’ve just started looking at one or two deals in the office space where we’d turned down 20 deals before,” he noted.