Local authority pension fund buys Leeds office block for £26m

The West Midlands fund looks after the pensions of council workers from Wolverhampton, Sandwell, Dudley, Walsall, Birmingham, Solihull and Coventry as well as other public sector employees. It has 300,000 members and £14.3 billion in assets. It invests in a broad range of shares, bonds and property around the world

City Point in Leeds is a fully occupied 61,379 sq ft office building that delivers gross rental income of £1.6 million a year.

The £14 billion West Midlands Pension Fund has 300,000 members and invests in shares, bonds and property around the world.

The building was owned by UK property company RDI, which sold the building for £26.05m. It bought the building for £21.6m in March 2016 as part of its acquisition of the AUK portfolio and has since let 11,000 sq ft to Blacks Solicitors to bring the building up to full occupancy.

RDI said the sale was in ine with its stated strategy of recycling capital out of mature assets and into new growth opportunities.

Chief executive Mike Watter said: "The disposal of City Point, Leeds represents yet another example of delivering value from the AUK acquisition.

"After two years of owning this asset, we have delivered an excellent 20.6% premium to the acquisition price, whilst also de-risking the portfolio by reducing our exposure to a maturing regional office investment market and an asset with a number of upcoming lease breaks and expiries. We are confident that the progress on our active recycling will support our relentless focus to deliver superior, sustainable and growing distributions."

RDI owns properties valued at £1.5bn in the United Kingdom and Germany across shopping centres, retail parks, offices, hotels and logistics sites.