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C&W helps BP to maximise the sale value of their HQ whilst avoiding overlapping occupancy costs and all within a strict timetable.
The ChallengeBP retained Cushman & Wakefield to structure the sale of their Lisbon headquarters and simultaneously secure new leased offices.
Their existing 12-level office building comprised 8,570 m ², situated on Rua Castilho in central Lisbon. It was wholly occupied by BP, apart from 3 small tenancies leased to unconnected companies. The property was in need of major restoration work.
Timing was crucial, as BP sought to avoid an overlap in property occupancy costs and required sale proceeds in the bank within 9 months of instructing C&W, whilst maximising the achievable sale value.
Our ImpactC&W quickly established that a short term sale & leaseback transaction would enable BP to satisfy their new office requirement and maximise the sale value of their existing building. This short-term leaseback provided sufficient time for us to negotiate with a developer to construct a purpose-built office in an out-of-town location. Further, it also enabled us to maximise the sale value of the old building by providing the purchaser with short-term income security and time to plan the building’s refurbishment.
The purchase was made by Euro 5 Property fund BV (LaSalle Investment Management) and represented their first Portuguese property acquisition.
Running in parallel with the investment team the tenant representation team carried out objective and financial analyses of 10 relocation options.
From the 10 relocation options 3 were short-listed. The landlords of the short-listed properties were asked to provide their best financial offers based on contract heads of terms drafted by CWHB.
Whilst keeping options open C&W negotiated with Teixeira Duarte, the developer of the preferred property (Edifício 3 Lagoas Park), achieving an incentive package, including rent free and capital incentives, providing a 20% saving in occupational costs.
The OutcomeC&W exceeded BP's expectations of price and met the tight timeframe set in what was a complex transaction linked into their relocation.
We added value by using a focused approach to BP's requirements, succeeding in creating a high level of interest and competition between office developers, thus maximising BP's strength as a future covenant and minimising their future occupational costs.