By Ian McConnell

AEW UK REIT has completed the sale of 225 Bath Street in Glasgow for £9.3 million, with the building to be demolished and replaced with student accommodation.

The investment company said the sale “realises a long-term change-of-use strategy for the asset, with contracts for the sale having been exchanged with a subsidiary company of IQ Student Accommodation in October 2020”.

It added: “As stated...on 11 February 2022, planning consent has been gained by IQ for the demolition of the property and development of a 527-unit student accommodation scheme.”

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AEW UK REIT said the sale agreement had required it to “negotiate with tenants to bring the asset to vacancy and, as a result, following its sale the occupancy rate for AEWU’s remaining portfolio will increase to 91.6% from 86.97% as at 30 June 2022”.

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It added: “Reinvestment of the sale proceeds into pipeline assets under exclusivity is expected to provide a significant boost to the company’s earnings due to both higher levels of anticipated income receipts and lower running costs.”