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An Isle of Man-registered investor has completed the first in a series of planned acquisitions designed to take advantage of the current downturn in the UK property market. Wichford, which invests in properties occupied by Government bodies, has bought St Anne House in Croydon.

The freehold was sold by an Invista managed fund for more than £15 million, reflecting a net initial yield of 7.25 per cent.

St Anne House is a 1960s building situated in Croydon’s main business area. It covers some 73,000 sq ft across 12 floors and was refurbished in 2002. The total rental income of the building is more than £1.1 million a year or £15.89 per sq ft.

The majority of the building is let to the Home Office until April 2017 on a lease that has a break clause in 2012. The other occupant is engineering company Mott MacDonald, which has two years left to run on its agreement.

Wichford chairman Philippe de Nicolay said: “The problems in the UK property market will undoubtedly produce opportunities for Wichford to be able to purchase earnings enhancing properties let to the Government, and I look forward to making further acquisitions as the year progresses.”

Approximately a quarter of Wichford’s portfolio comprises public sector-rented properties in Germany, the Netherlands and France. This is its first acquisition in the UK since it bought three properties for £30 million last May. In the six months to April this year, the company reported a post-tax loss of £74.8 million.

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