Listed property company Hammerson has acquired the virtual freehold of a 26-storey office tower in the City of London from investment manager Prupim for £100 mln (EUR 111 mln), including costs. Prupim sold the 999-year leasehold interest in 99 Bishopsgate, London on behalf of Prudential Assurance Company.

The property comprises 31,500 m2 of office accommodation in the centre of the City of London. It is occupied by a number of financial and professional services companies, including Deutsche Bank, Latham & Watkins, Korea Development Bank and Charles River Associates International.

Hammerson has owned a long leasehold interest in the property, which expires in 2100, since it was redeveloped in 1994. The rent payable to Prudential was £4.2 mln per annum. Net of head rent, Hammerson's passing rents at end-December 2010 were £13.6 mln, and at that time Hammerson's interest was valued at £126 mln.

Deutsche Bank is expected to vacate the majority of its space later this year. Hammerson intends subsequently to refurbish approximately 13,500-m2 of the office space to be ready for occupation in 2012 when the London office market is expecting a period of undersupply.

Hammerson is a registered real estate trust in both the UK and France. The company's £5.3 bn real estate portfolio consists of 17 shopping centres, 17 retail parks and seven London office buildings.