The U.K. arm of Warner/Chappell Music has sold its West London office to British aid organization John Lyon’s Charity for £22.6 million ($32.7 million).
The sale was originally reported in Property Week, who said the deal reflected a 3.4 percent yield.
The former electricity generating station, which was originally constructed in the 1880s and is located at 46 Kensington Court, comprises 16,170 square feet of offices and is situated just off Kensington High Street.
Following the sale, Warner/Chappell will lease back the offices, having agreed a 15-year lease, with a break option at 10 years. Property Week reports that the Warner Music Group subsidiary will play an annual rent of £790,000 ($1.1 million), which equates to £49 per square foot.
“We believe that this is a particularly attractive investment for the charity and will complement our existing portfolio well,” said Ross Owen, Cluttons’ head of investment and fund management, which advised John Lyon’s Charity.
In a statement he went on to say: “This part of Kensington has historically been home to numerous music, fashion and media tenants, with easy access to the West End and other areas of London. Off the current rental base, we consider that the investment offers excellent prospects for growth over the medium to longer term.”
The origins of Warner/Chappell date back to 1811 when Samuel Chappell opened Chappell & Co in London’s Bond Street. The modern day incarnation of the company was established when Warner. Bros. Music brought the company in 1987.