The Edinburgh office market received an important vote of confidence following the sale of Grade A Exchange Place One in an off-market transaction.
The 114,748 square foot building, located on Semple Street with ‘awe-inspiring views’ of Edinburgh Castle, was purchased by CBRE Investment Management UK Property PAIF from Macquarie Asset Management.
Real estate company CBRE, which acted on behalf of the buyer, said the deal shows “there continues to be strong interest in high quality assets in the right locations” despite the pandemic. He said the new owner was planning to invest more in the building.
Tenants of Exchange Place One include BlackRock, which occupies four floors, Hymans Robertson, Cundalls, Cameron Hume, and Evans Cycles.
Alistair Wright, Director of CBRE Scotland, said: “It is great news that we have been successful in securing an off-market purchase of this famous Class A office building in a location rarely available in Edinburgh for CBRE Investment Management.
“The acquisition of Exchange Place One, which currently enjoys a BREEAM ‘Very Good’ rating, offers the Fund a unique opportunity to create a first-rate office building that responds to the strong market demand for office space. durable central offices with large floor plates. The exciting plans for the asset include a full internal refurbishment with a strong focus on improving the building’s ESG benchmarks which will include a full decarbonization strategy.
“The Fund will make a substantial investment showing that despite the pandemic, there continues to be a strong interest in high quality assets in the right places.”
CBRE said “market dynamics are very favorable” in the Edinburgh office market, with a Grade A vacancy rate in the city center of 2.2%. He said this reflects a limited supply and high demand for high quality office space.
Jamie Phillips, CBRE UK Property PAIF Fund Manager at CBRE Investment Management, said: “This is a really exciting opportunity to acquire a Class A office building in a fantastic location.
“Edinburgh is a vibrant city and its status as a UNESCO World Heritage Site places certain constraints on the city’s future commercial development. In part, this underlies the under-supply of Class A inventory, which is at its lowest level in 20 years.
“Exchange Place One has some impressive floor plaques, which can be hard to find in Edinburgh. Our business plan aims to take the building to the next level, creating a top quality office building that gives Edinburgh’s occupying businesses a sense of place and the strong sustainability credentials tenants demand from them. rightly.