3 St Paul’s Place, the flagship office building in the heart of Sheffield, has been sold for £24 million.
It has been bought by London-based investment company M&G Real Estate.
Developers U+I and CTP, who built the 78,000 sq ft Grade A speculatively, hailed the sale “as a massive vote of confidence in the city of Sheffield.”
David Topham, director of Manchester-based developers CTP commented: “We are tremendously proud of what we have achieved at 3 St Paul’s Place. It is the first speculative office building to be developed in Sheffield since the recession and now boasts a number of high-quality occupiers.
“The sale completes the St Paul’s Place masterplan, which has been a primary regeneration initiative for Sheffield city centre and a crucial part of Sheffield’s £185m Heart of the City project. It puts Sheffield firmly on the map as a business destination.
“The remarkable success of St Paul’s Place, and 3 St Paul’s Place in particular, has transformed and ignited the city’s office market. When we embarked on the overall development, Grade A rents were about £15 per sq ft. They are now a record-breaking £24.50 per sq ft.
“We have developed a high-quality investment class product for the city attracting Standard Life, Canada Life, GE Capital and M&G to Sheffield. This has revitalised not just the office market in the Sheffield city centre, but the retail offer too.
“This city centre transformation is critical to Sheffield’s future, acting as a catalyst for further regeneration and underlining the city’s exciting future as a leading UK city. Sheffield now has a balanced and productive economy, straddling many sectors including advanced manufacturing, health and wellbeing and education, alongside a wide range of creative and professional services,” said Mr Topham.
High-profile occupiers at 3 St Paul’s Place now include civil engineers Arup, architects BDP and HLM, leading Swedish bank Handelsbanken and lawyers Freeths.
Simon Hesketh of co-developers U+I said: “We are delighted to have been involved in delivering 3 St. Paul’s Place, a first class office development for Sheffield. The sale to M&G underlines the quality of the building and underlines its position as significant new commercial centre for the city.”
Henrie Westlake, investment partner at the Leeds office of global property consultancy Knight Frank, who advised CTP and U+I, commented: “The sale of 3 St Paul’s Place reinforces the building’s position within the market, as one of the most prestigious developments within the Sheffield City Region.
“3 St Paul’s Place really is a fantastic scheme, with a prime Heart of the City location and excellent public realm amenities on the doorstep. The quality of the occupiers already at No 3 is superb. All of these factors have made the building a very attractive investment, reflected in the sale figure of £24million.”
The construction of the 10-storey 3 St Paul’s Place went ahead following a landmark agreement between CTP and U+I, the specialist regeneration developer and investor, with Sheffield City Council and the Department for Communities and Local Government. Further finance was provided by Barclays and SCR Jessica.
David Topham commented: “We are very grateful to all our funders and investors, who backed our plans in the recession when development finance was scarce. They believed in us and we are delighted to have repaid that faith.”
Councillor Mazher Iqbal, cabinet member for business and investment at Sheffield City Council said: “3 St Paul’s Place has fast-established itself as one of Sheffield’s most distinctive and renowned buildings, with a number of the region’s biggest employers now calling it home.
“We are delighted to see this building now enter a new era with its sale to London-based investors and developers M and G. We are convinced that this will continue to spearhead the transformation of Sheffield’s city centre offer and see more big names become established in the heart of the city,” he said.
St Paul’s Place is a high-quality mixed-use scheme which features the 161-bed St Paul’s Mercure 4* hotel, and was voted Development of the Decade for South Yorkshire in 2017.
No1 and No 2 office developments are occupied by lawyers DLA Piper, RBS, Barclays, accountants PwC, Coutts, property consultancy Lambert Smith Hampton and the Department of Children, Schools and Families; a 330-apartment residential tower block; the famous “Cheesegrater” car park, operated by Q-Park; a casino; and restaurants and cafes including Pizza Express, Piccolinos, Café Nero, Oisoi, Bill’s Restaurant and Café Rouge.