Plans for new apartments at a prime building in the centre of Cardiff have been revealed. It comes as Atlantic Venture Capital, advised by property advisory firm Savills, has acquired the 2 Queen Street building from a private trust for £685,000.
The sale price represents a net initial yield of 7.26%. The prominent period property, which extends to just over 2,300 sq ft, provides five floors of accommodation with a retail convenience store let to Spar at the ground floor and basement with office space on the first, second, third and fourth floors. The buyer will be looking to convert the upper floors into residential serviced apartments, subject to planning permission. Atlantic Venture Capital also owns an adjoining building occupied by Starbucks - although there aren’t current plans to turn part of that property into apartments.
The acquisition forms part of a growing trend of retail and office space being repurposed - as well as increasing investment in build to rent properties. Last month it was confirmed that the Knox Court office building in the centre of Cardiff will be turned into apartments, subject to planning.
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The 60,000 sq ft office building, which will be vacated next year but its current tenant L&G for the financial services firm's new Cardiff HQ at the Interchange development at Central Square in front of Cardiff Train Station, will be repurposed by its new owner in Urban Centric - which acquired the building from Maya Capital in a multi-million-pound deal.
Ross Griffin, director in the UK Investment teams at Savills’ Cardiff office said of the Queen Street property investment deal: “We are delighted to advise our client on the acquisition of this well located property. The property has a strong tenant line up on the ground floor and opportunity to increase rental income with change of use on the upper floors. The property was also acquired due to adjoining ownerships creating further asset management opportunities, subject to planning permission.”
Fletcher Morgan advised the undisclosed seller on the deal. Matthew Jones, director at Fletcher Morgan, said: “Despite the uncertainty around the Covid pandemic, this well located property proved to be very popular for investors when we launched it to the market earlier this year. Due to the marriage value of owning the adjoining assets, we recommended Atlantic as the best party to progress with."
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