Riverside Capital have announced the acquisition of Pure Gym, Wandsworth Road in London SW8. The total purchase price for the new 999 year headlease at a peppercorn rent was £2.55m reflecting a Net Initial Yield of 7.78%.
Connection Capital clients have invested £1.55m of equity. RBS is providing a further £1.4m as a loan facility. Riverside Capital’s Ashley Wilcox acted as investment advisor for the acquisition and will monitor the investment going forward.
The property totals 15,230 sq. ft. and occupies part of the ground and lower ground floor levels of Cantilever House.
Mount Anvil converted this iconic 1960s modernist structure to provide a contemporary and stylish collection of retail, office and residential spaces. The conversion was completed in late 2011 with Pure Gym taking occupation in December 2012.
Pure Gym, a low-cost gym company, recently announced it was investing a further £50m in new fitness centres following its takeover by a US private equity firm.
Peter Roberts, CEO, Pure Gym, said, “I am delighted to hear of Connection Capital and Riverside Capital’s recent purchase of our Pure Gym investment in Vauxhall. With Pure Gym’s recent takeover by US private equity firm CCMP Capital Advisors, we have secured our growth plans with a £50m war chest available for further expansion. We intend on opening at least 15 new gyms in London over the next 12 months, in addition to a further 25 across the country. The takeover should give our Estate landlord’s even greater comfort regarding our financial strength now and for the future”.
Ashley Wilcox, Investment Director at Riverside Capital, added, “The Riverside Capital team have delivered a solid investment at an attractive price in the current market. Investors can expect to see a sound income return together with strong potential for capital growth. We see Vauxhall and Nine Elms as an exciting sub-market in terms of growth prospects over the next few years. In addition, the recent Private Equity buy out of Pure Gym by CCMP Capital Advisors and their projected brand growth will undoubtedly enhance our return further.”