Another Brixton landmark looks set to tumble following the sale of Blue Star House opposite the Academy on Stockwell Road.
It is, among others, currently home to a Nando’s and the world-leading type design agency Dalton Maag. It also housed some Lambeth council offices.
The new owner, Derwent London plc, believes “vacant possession can be achieved in the next few years and there is scope to redevelop the site with a significantly larger scheme”.
It said two floors of the building are vacant at the moment.
Including joint ventures, Derwent owns more than 80 buildings valued at £5.4 billion, mainly in central London.
It paid £38.1m for the 0.7-acre Brixton site and says that the current average rent of £14.50 per square foot is “low”, adding: “The acquisition price equates to a capital value of £710 per square foot”.
Offices in the building were recently advertised at £30 a square foot.
Derwent says it has “a long track record of creating value throughout the property cycle by regenerating our buildings via development or refurbishment, effective asset management and capital recycling.
“We typically acquire central London properties off-market with low capital values and modest rents in improving locations, most of which are either in the West End or the Tech Belt.
“We capitalise on the unique qualities of each of our properties – taking a fresh approach to the regeneration of every building with a focus on anticipating tenant requirements and an emphasis on design.”
Proximity to the West End is cited as a major reason for the purchase. Paul Williams, chief executive of Derwent London, said: “We are delighted to have acquired Blue Star House and added Brixton as a location within our portfolio. With its excellent connectivity to the West End, we see this as an exciting addition to our substantial development pipeline.”
Brixton underground and overground stations are only a few minutes’ walk away with travel times to Victoria and Oxford Circus of just seven and 11 minutes respectively, Derwent said.
The company says it was the first UK real estate investment trust to sign a green revolving credit facility and has launched a green finance framework and signed the Better Buildings Partnership’s climate change commitment. It says it is one of only a few property companies worldwide to have science-based carbon targets validated by the Science Based Targets initiative.
Blue Star House, constructed in the 1960s, was once owned by Lambeth council. The UK Land Registry lists the owner before Derwent as the London-based Lancedrum Ltd, two of whose five directors live in the USA.