Peel has put The Alex on the market for £9m. It’s a 58,000 sq ft office at Salford Quays, let to M&S and a government department. As Place North West reported, it’s being offered for sale now.
Selling one thing while buying another
The timing is what makes this worth a paragraph. In the same week Peel triggered a mandatory offer for Harworth worth close to £600m, it’s selling a well-let office for £9m.
There’s nothing odd about that. Large property groups run portfolios, and recycling capital out of standing investments into land and development is ordinary practice. It’s a reminder that Peel is reshaping what it holds, trading out of standing income and into land.
It also tells you something about relative appetite. Peel is happy to sell an office with two solid tenants and buy 15,000 acres of development land instead.
What £9m for 58,000 sq ft says
That’s about £155 a square foot for a let building with M&S and a government department in it.
Set that against the office market we’ve been tracking. Liverpool is trying to shift 85,000 sq ft of empty offices for £3.25m, roughly £38 a foot. Network Rail is spending £40m on 108,000 sq ft in Leeds, about £370 a foot, to bring a station-adjacent building up to modern standard.
The Alex sits between the two, which is roughly where a decent but unspectacular let building should sit. Income is what separates it from Liverpool’s empties.
Salford Quays
The Quays is one of the North’s genuine regeneration successes, built on MediaCity and three decades of steady investment. It’s now mature enough that assets trade rather than get developed, which is what a working market looks like.
Worth watching who buys it. An owner-occupier, an institution or an opportunistic investor each imply different things about where Salford Quays offices are heading.
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