Rothesay backs €329m Sanctuary Buildings deal

The Korean buyers of Sanctuary Buildings in London have financed the £285 mln (€329 mln) deal with a loan from annuity provider Rothesay Life.

Rothesay’s facility, for £180 mln (€206 mln) for a five-year term, is its second large loan on a prominent central London office building to be closing this month.

Rothesay is also the debt provider for National Pension Service of Korea’s £1.16 bn (€1.33 bn) acquisition of Goldman Sachs’ headquarters, a deal due to close imminently.

Blackstone completed the sale of 227,000 sq ft (21,089 m2) Sanctuary Buildings last week to Hana Financial Group and Kiwoom Securities.

The private equity firm bought the building four and a half years ago for £175 mln (€201 mln) and regeared the lease – which had three years left at the time – with tenant, the government’s Department of Education. Blackstone put the asset on the market last September.

The buyers are acquiring the asset in London’s Victoria district with the benefit of a new 15-year lease, at a net initial yield of 4.2%.

Rothesay, a low-profile senior lender with a property book of more than £5 bn (€5.7 bn), has been focusing on credit-linked office buildings and multi-family financings, sometimes in complex transactions. A year ago the insurer structured a £230 mln (€264 mln), 25-year loan for Allied London secured on Manchester’s 34,000 m2 Civil Justice Centre at the developer’s Spinningfields complex.

That transaction had previously been financed via an RBS Luxco issued securitisation and involved taking on a very long-dated swap.

Rothesay can also lend across Western Europe and on other real estate asset classes.

Hana has been a prolific European investor in the last 12 months. Its acquisitions include the Helix building in Eschborn near Frankfurt, bought in December from Commerzbank for €120 mln. The same month, the financial group bought One Poultry, WeWork’s City of London flagship, for £185 mln (€212 mln) from Aermont.

CBRE and Savills advised Blackstone on Sanctuary Buildings. JLL’s debt advisory team advised on the financing.

LaSalle Investment Management advised NPS on the acquisition of Goldman’s HQ at 40 Shoe Lane.

This article first appeared in EuroProperty, PropertyEU's sister publication.


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