Reading: Singapore’s Mapletree set to buy £500m-plus Green Park

Oxford Properties is in final-stage talks to sell Green Park in Reading, one of the South East’s key business communities, to Singapore’s Mapletree Investments for in excess of £500 million, in a move that would crystallise a notable return on investment following a highly-successful five-year leasing and asset management programme.

Oxford Properties bought the 1.3m sq ft park from Prupim in November 2011 for £400m. At the time the park was around 90% let.

The group then deliberately took the park down to 47% let after completing a lease surrender with US IT giant Cisco on 517,000 sq ft of unoccupied property in 2012.

The agreement was reached across five office buildings, including 350 Longwater Aveue, 400 South Oak Way and 450 South Oak Way, in return for a substantial pre-payment of Cisco’s obligations.

The deal gave Oxford Properties full control of the assets enabling it to press on with leasing at the familiar landmark scheme fronting the M4.

It subsequently signed Chinese telecoms giant Huawei for the 139,239 sq ft 300 South Oak Way and has continued to sign a range of smaller lettings while remodelling buildings including 450 South Oak Way which PC'd in September of last year.

Pepsico leased all of the 105,000 sq ft 450 South Oak Way meaning the park was circa 75% leased with rents for the smaller space having moved from around £25 per sq ft at the time of Oxford Properties' purchase to circa £33 per sq ft. The smaller deals have tended to be expansionary ones for existing tenants.

At the beginning of this year occupiers signed up to a further 215,000 sq ft, taking the occupancy at the business park to over 92%.

Significant new lettings to Thales and Bayer for 111,064 sq ft and 80,000 sq ft respectively were agreed, together with deals to expand the offices of existing occupiers Proofpoint and Datto.

Oxford, advised by Eastdil Secured, has now entered final stage talks to sell the park to Singapore’s Mapletree for in excess of £500m. It is understood that any deal would involve Oxford Properties remaining as asset manager until the year end to ensure a smooth transfer.

Singaporean REIT Mapletree made a particular name for itself as an active buyer of UK regional assets last year with a £360m triple-swoop on three prime office buildings in Aberdeen, Bristol and Manchester.

Campbell Gordon, Cushman & Wakefield act on behalf of Oxford Properties at Green Park as leasing agents.

Article by Paul Norman

Credit: CoStar