Capital & Counties Properties Plc (CCO) has acquired control of 100 per cent of the Empress State Building having exchanged contracts with Land Securities Group PLC for the 50% not already owned for a price of GBP117 million.

The Empress State Building is a 451‚000 sq ft‚ 31 storey‚ office building located adjacent to the Earls Court & West Kensington Opportunity Area. It is fully let to the Mayor’s Office for Policing and Crime until June 2019‚ with annual rental uplifts indexed to RPI with a floor of 2% and cap of 5.25%. The current rent passing is GBP14.9 million. The purchase price represents an initial yield of 6.2% and an equivalent yield of 6%.

The company said in the medium-term‚ opportunities to extend or review the existing lease will be considered or alternatively the property may be suitable for a residential conversion in line with the plans for the Earls Court Masterplan.

The price of GBP 117 million will comprise a cash payment and the assumption of Land Securities'share of the existing GBP 131 million debt facility‚ which will remain in place until maturity in August 2013. A new five year debt facility is currently under negotiation.

Gary Yardley‚ Investment Director of Capco‚ commented: "The Empress State Building provides an attractive income stream until 2019 whilst offering a number of options to create further value over the medium-term as the area benefits from the implementation of the Earls Court Masterplan."

Scott Parsons‚ Head of Property‚ London at Land Securities said: "The sale of the Empress State Building fits our strategy of recycling capital through disposals where we do not see an opportunity for full control of the asset management or development of the site."