Bede House is the latest Tyneside property to be snapped up by investors from outside the North East
A London investment firm has snapped up a promiment Newcastle office scheme in a £4m deal as part of plans to plough £50m into the regions.
Maya Capital LLP, a specialist real estate investment firm, is demonstrating its confidence in the UK's regional real estate markets through an agreement with a major institutional investor to spend up to £50m of capital on office buildings in regional cities across the UK.
The company has closed its first investment as part of the moves, with the £4m purchase of Bede House in Newcastle, a 38,000 sqft multi-let office building at a net initial yield of around 8.6%.
Maya Capital is targeting UK office real estate outside London and the M25 and directors said that more transactions will be completed in the coming months to reach a total deployment of £50m by the end of 2018.
The firm said the aim is to build a portfolio of UK secondary office assets targeting smaller assets, where better pricing can be reached due to the lack of investor competition.
Knight Frank advised Maya Capital on the Newcastle transaction, which comes two years after the investment firm bought two Cobalt Business Park properties in North Tyneside.
In June 2015 the firm bought Cobalt 9b, a 52,000sqft office building let to Siemenss Energy Service for £8m and Cobalt 15, a 93,500sqft office building let to the Department of Work and Pensions for £13m.
David Pralong, managing partner of Maya Capital, said: "We continue to be excited by the existing opportunities in the UK's regional cities, where there is a combination of high yield and low vacancy rate, which compares favourably to London.
"Today's announcement highlights the continued investor appetite for a niche and robust regional strategy trageting smaller asset sizes.
"We are delighted to have the backing of a top-tier institutional investor that has committed to our transactions in the months to come."
A number of properties across Tyneside have been snapped up this year as investors from outside the North East seek to gain a foot hold in the regions.
The Royal Mail base at North Tyneside's Balliol Business Park was bought by Buccleuch Property for £2.55m last month, representing an initial yield of 8.2%.
And Palace Capital is now the owner of the Jury's Inn hotel in Newcastle and its surrounding offices and apartments following a £20m deal also completed last month.
The London investment firm acquired the entire share capital of SM Newcastle OB Ltd, which owns the hotel as well as the freeholds of 1, 2 and 3 St James Gate, home to 145 apartments and more than 140,000sqft of office space.
Meanwhile, the new Premier Inn in Whitley Bay was bought by fellow London investors LXi REIT, before work started on its construction.
LXi REIT has cemented its confidence in the region by forward-funding the 68-bedroom hotel in April, less than a month after announcing it was putting £11m into a new HQ for Cramlington firm PII Pipeline Solutions.