Chinachem Group with Helical Plc will purchase the 150-year long leasehold interest of Kaleidoscope, an office property situated in an emerging new tech cluster in London, at £158.5 million, reflecting a capital value of £1,789 psf.
The lease from Transport for London was granted in 2018 and has a head rent geared to 10% of contracted rents. Completion is due to take place in ten days. This transaction marks the Group's first overseas acquisition, which will help drive its portfolio diversification and sustainable growth.
Newly completed in 2019, this six-story 88,580 sq. ft. office building is situated above the Farringdon East Crossrail Station. This well-connected area has attracted many tech companies to settle there, while the UK headquarters of Amazon and Snapchat are nearby.
Situated at Lindsey Street, EC1, Kaleidoscope is currently fully occupied by Tiktok, the popular short-form video hosting service owned by ByteDance, who took a 15-year lease in March 2021 at £7,633,053 per annum (an average rent over £86 psf). The PLP-designed scheme is accredited BREEAM Excellent, WiredScore Platinum, and provides a 5,000 sq. ft. roof terrace together with spa-quality end-of-journey facilities and features integrated artwork by Dutch artists De Makers Van.
Donald Choi, Executive Director and CEO of Chinachem Group, said, “We're delighted to have acquired Kaleidoscope successfully as it is located in a prime position in one of London's most dynamic, vibrant, and culturally rich sub-markets with impressive rental growth. We intend to hold this property for long-term investment.”
He added,: "Having now made our London entrance, we will incrementally increase our exposure in gateway cities of other major developed markets to move further forward our diversification objectives and build a long-term resilient income stream. However, Hong Kong remains our home and the core market of our business operations."
Matthew Bonning-Snook, Property Director at Helical, commented, "Kaleidoscope was the first over station development to complete on the Elizabeth Line and we were able to attract one of the world's fastest-growing tech businesses due to its striking design, highly accessible location, excellent amenities, and strong environmental credentials. We will now seek to recycle the proceeds from the sale into delivering new highly sustainable 'best-in-class Central London office schemes, where occupier demand remains strong."
