A 60/40 joint venture between Max Property Group and Newmarket Property Holdings, a subsidiary of an overseas family trust, has agreed to purchase the freehold St Katharine Docks from St Katharine's Investments. The cash consideration of £156 mln (EUR 174 mln), net of acquisition costs, equates to a capital value of £330 per sq ft.

Terms have been agreed with German bank Eurohypo to provide debt of up to 55% of the purchase price, and completion is scheduled to occur on or before 8 August.

Situated on the Thames, immediately adjacent to Tower Bridge and the Tower of London, the Estate comprises 500,000 sq ft (46,500 m2) of offices, restaurants and shops, together with Central London's only marina which extends to a total of 10 acres and comprises 160 berths. The estate is let to a wide range of tenants, currently generating an annual rent roll of £12.6 mln, and with a vacancy rate of 12% which gives the potential to improve facilities and tenant mix through a rolling refurbishment programme.

One of the estate's main buildings, Commodity Quay, comprises 130,000 sq ft of offices with 80% occupancy. It is likely to fall vacant next year, Max Property said, providing an opportunity for a comprehensive refurbishment scheme, to be launched into the lettings market in 2013, ahead of the development pipeline elsewhere in the City. The balance of the portfolio comprises five buildings with 60 tenants and 76% of the total rent roll.

The purchase increases Max's share of gross assets to £412 mln and net gearing to 33%. Following the acquisition, Max will have £35 mln of uncommitted cash for future investments remaining from the initial £211 mln raised in May 2009.

Max Property Group Plc is a Jersey incorporated closed-ended real estate investment company. It is externally managed by Prestbury Investments, which is owned and managed by a team led by Nick Leslau and Mike Brown.

The company listed on London’s Alternative Investment Market and on the Daily official list of the Channel Islands Stock Exchange in May 2009.