The commercial elements of one of Birmingham’s most high profile buildings has been sold for around £40 million.
Aruna Projects, represented by Savills, has sold all parts of The Cube except its 244 apartments, to EPISO 3, a fund advised by Tristan Capital Partners.
The price reflects a net initial yield of 8.42 per cent, Savills said.
Aruna have retained the residential elements which they will continue to market and are understood to be values at around £20 million with the apartments achieving around £300 per sq ft.
The 25-storey mixed-use development was originally the brainchild of Alan Chatham’s Birmingham Development Company which was planned to complement the successful Mailbox scheme, home to the BBC and Harvey Nicholls and bought by Brockton last year for £127.1 million.
BDC brought in Ken Shuttleworth and his Make practice to design the building. Its complexity and the challenging canalside site saw BDC create their own main contractor – BuildAbility – to build out the project.
However, the build programme coincided with the credit crunch and the collapse of commercial property prices and the project’s backers Lloyds, who lent around £92 million to BDC for the project, called in PwC as administrators after claiming it had lost confidence in some of the management.
The freehold for the building was tranferred from BDC to subsidiary vehicle Aruna Project which was headed up by former BDC director and shareholder Neil Edgington while Mr Chatham and his partner Mark Billingham severed all ties with the project.
Aruna, represented by PwC as administrators of BDC, completed and delivered The Cube in 2011.
Mark Batten of PwC said: "We are delighted to have been involved in this successful construction and property project, and to conclude a successful disposal of a part of the property in a challenging market is testament to the quality the market sees in underlying assets."
The Cube’s commercial elements include retail, leisure including health and fitness, hotel and restaurants in addition to 111,500 sq ft of grade-A office space.
Office occupiers include The Highway’s Agency, Solicitors Regulation Authority and The Law Society, plus resturanteurs Marco Pierre White and Rodizio Rico.
Jonothan Holmes, director of investment at Savills, added: "The Cube is one of the most striking buildings in Birmingham and the wider regional markets and boasts a strong tenant mix across a broad range of uses.
"We had a very high level of interest from both UK and overseas investors and are pleased with the price achieved for our client, illustrating once again that the investment market in one of the UK’s leading regional cities, remains very strong for well let city centre buildings."
Tristan Capital Partners were represented by Capital Real Estate Partners.