An Israeli insurance and financial services company has bought 115 Colmore Row for £32.2 million.
Clal Insurance Enterprises Holdings, listed on the Tel Aviv Stock Echange, has a portfolio of properties with 76 per cent in Israel and the rest in London.
The 80,000 sq ft Colmore Row property near Victoria Square is rented to law firm Eversheds LLP in a lease with 11 years left to run, with no early exit clause.
The net operating return on the building is £2.2 million a year, for a gross annual return on investment of seven per cent.
Clal Insurance said the current rent reflects a price of £25.20 per sq ft per year, but that the property has improvement potential, as prevailing rents in the area are £28.50 per sq ft per year.
Amir Schostak from Clal Insurance real estate operations said that the purchase improves the company’s foreign property portfolio, with the goal of diversifying the company’s assets.
Clal Insurance posted net earnings attributable to equity-holders for the first nine months of 2011 of around £16 million, compared with earnings of around £70 million for the same period in 2010.
The loss after tax in the third quarter was around £32 million, compared with around £29 million the year before.
Clal Insurance is a subsidiary of IDB Holding Corp, chaired by one of Israel’s richest men Nochi Dankner.