Glasgow’s Ca’d’oro building sold in £14.1m deal

One of Glasgow’s most well-known buildings has changed hands for £14.1 million in a move that indicates increased foreign investment in the city’s commercial property.

The iconic Ca’d’oro Building, located on the intersection of Gordon Street and Union Street in the city’s centre, has been purchased off-market by a private overseas investor.

The sale price reflects a net initial yield of 6.5 per cent to the purchaser, agent Knight Frank said.

The Ca’d’oro Building – or ‘House of Gold’ – named after the gilded 15th century Palazzo Santa Sofia palace in Venice, was built in 1872 and provides 47,397 sq. ft. of high quality office and retail accommodation over basement, ground and four upper floors.

Its current tenants include law firm Harper Macleod, the Co-operative Group and Atos IT Services.

Knight Frank has managed the building since its purchase from insurance provider AXA in 2013, overseeing more than £1.6 million of refurbishment work carried out on the building.

Patrick Ford, partner for Knight Frank in Glasgow, said the deal was indicative of more international investors looking at commercial property opportunities in the city.

He added said: “The Ca’d’oro deal demonstrates the high level of demand from overseas investors, which is becoming increasingly relevant as Glasgow’s, and Scotland’s, investment environment evolves into a truly global market. Traditionally we’ve seen German and North American money coming into the city, but now we’re receiving more interest from the Middle East, Israel and other parts of Asia.

“Prime yields are now at 5.50 per cent, a relative discount to the other big six regional centres. Given the almost unprecedented demand for prime office space and relative value compared to other regional UK cities, many international investors will see Glasgow as a great opportunity to achieve strong returns and sustained performance.”

Stephen Kelly, director at Hamilton Capital Partners, said: “Knight Frank advised us on the purchase and successful sale of this large and complex asset. The firm complemented its transactional advice with expertise from the building consultancy and management teams, which operated under difficult conditions to achieve an outcome in excess of our expectations.”