AJ100 big hitter Allies and Morrison has made millions of pounds of profit after selling its award-winning Southwark offices to Standard Life Investment UK Property Fund for £30.1 million
The practice bought the adjoining sites at 85 and 89 Southwark Street, south London for £1.03m in 2000, building two new blocks and renovating a listed property to create the company’s new home. Although the costs of the project have always remained confidential, experts estimate the job came in at around £10 million.
If correct, the practice will have made almost £20 million out of the property.
Completed in 2003, the 4,257m² scheme close to the Tate Modern went on to win numerous accolades including the RIBA London Building of the Year 2004.
It is understood agents GM Real Estate acted for Allies and Morrison on the 15-year sale and leaseback deal of the interlinking buildings.
A spokesman for the practice said: ‘The sale and leaseback opportunity was offered to a selected group of investors who were invited to offer lease terms to the partnership. We are delighted to have chosen Standard Life Investments UK Property Fund as our new landlord.
‘This is a positive step for the practice as it secures the studios at a planned rental level for the next 15 years.’
Allies and Morrison declined to comment on its level of spending and profit on the site.
Julian Hind, partner at specialist South Bank property adviser Union Street Partners:
‘This, just like a similar deal done recently with Standard Life by TP Bennett nearby, is an unequivocally good deal for Allies and Morrison. These are two very clever, entrepreneurial practices who invested in the South Bank at an early stage - I would say it was pretty pre-meditated and astute.
‘They saw potential in the area, backed that judgement with cash and are now reaping the benefits of a massive uplift in property and land values. They are selling at a good time – institutional and international investors are looking to spend money and get a foothold in the South Bank – the area is one of the most active in the capital at the moment.’