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Investec Ireland's Wealth Management Arm Capitalises on City Commercial Property
Investec Ireland's wealth management arm has realised a gain of 125 per cent on a geared investment in a central London property bought back in 2003.
A syndicate of around 30 investors, organised through Investec Ireland, sold a site at 2 Seething Lane near the Tower of London for £19 million. The sale comes three and a half years after it was bought for £14.8 million ($25 million) on a net initial yield of 8.3 per cent.
The tenant is the UK bank Abbey National, which has nine years left on a full repairing and insuring lease. The sale price reflects a net initial yield of 6.45 per cent.
Investec wealth manager John McWeeney said: "The decision to sell was based on the excellent returns generated by the investment and the outlook for similar returns in the near term given the current strength of the City office market."
On December 31 2006 Investec Ireland also realised a 60 per cent return for investors by disposing of two Swiss property investments located in the Swiss Cantons of Valais and Vaud, which surround Geneva.
The properties were sold for SFr 30 million and had been purchased in September 2005 for Sfr 26.5 millon ($21.4 million). The initial yield of the properties was 5.6 per cent and the exit yield was 5 per cent.
The tenant of both properties was a large retail agent in Switzerland.
Investec Ireland, is part of the specialist South African banking group, and employs 60 people in Ireland.
