Eskan Court, Milton Keynes - Sold in April 2019
Eskan Court was a multi-let office building constructed in the 1990s which was acquired in early 2014 from Aviva for a price of £3.025m. Debt was secured from Santander and just over £1.5m of equity raised. The original pricing reflected the short team leases at the property. Over the period of ownership a number of rent reviews and lease renewals were secured, void space was refurbished and re-let and ultimately a very strong WAULT was achieved of 6.9 years. In addition, the last letting was secured at £19 per sq ft whereas passing rents on purchase were £13.50 per sq ft (with quite significant incentives). The property was therefore sold with a strong proven reversionary rent.
Over the ownership period investors had considered a disposal in 2017 but a decision had been taken to retain the asset as there was further potential value enhancement to be achieved and this was duly delivered. The final sale decision was however made given the prevailing strong investment market conditions, the strong WAULT and the timescale to the next rent review profile. Sale price was £5.675m – nearly double the acquisition cost.