Leumi UK provides £44.4 million facility to Martley Capital for landmark Birmingham office acquisition

Real estate lender Leumi UK has provided a £44.4 million whole loan facility to Martley Capital, the full-service real estate investment management platform, to finance its acquisition of The Lewis Building, a landmark office-led asset in Birmingham's Central Business District. The transaction demonstrates Leumi UK’s commitment to building long-term, trusted relationships with its partners, as this is the seventh deal the two parties have completed together. 

The financing facility comprises a £40 million acquisition tranche and a £4.4 million capital expenditure facility and supports Martley Capital's acquisition of the freehold property.

Occupying a prominent 1.3-acre site with frontage onto Bull Street, Corporation Street and The Priory Queensway, the 254,000 sq ft asset comprises The Lewis Building, Priory Court and The Minories retail arcade. The property is currently let to 14 tenants, with approximately 70% of rental income backed by long-term government occupiers, and benefits from excellent connectivity to Birmingham New Street, Snow Hill and the future HS2 Curzon Street station.

The acquisition is in line with Martley’s broader strategy of targeting fundamentally strong assets in core regional locations, where there is a dislocation between capital market sentiment and occupational market performance. Leumi UK provided a £21.4m loan earlier in the year for the acquisition of three Grade A office buildings in Newcastle, Liverpool, and Chester.

Martley’s business plan for the Lewis Building centres on proactive asset management, with a focus on leasing vacant space, lease regears and targeted capital investments to enhance its amenities. It is expected that this will drive an increase in rental income, while positioning the asset to benefit from the continued rental growth in Birmingham. 

Dan Boakes, Executive Managing Director at Martley Capital, said: “The acquisition of this asset continues to align with Martley’s regional office investment thesis which is to acquire well located properties with strong fundamentals at substantial discounts to replacement cost. We are delighted to once again be working on a transaction with Leumi UK with whom we have developed a strong working relationship. The team’s specialist expertise, commerciality and ability to deliver tailored financing solutions at speed really sets them apart.”

Oliver Stenning, Relationship Director, Leumi UK, said: "The Lewis Building is a high-quality asset in one of the UK's strongest regional office markets, underpinned by secure government income. Over the past two years, we have built a strong and trusted relationship with Martley and are delighted to have supported them with this transaction, marking our seventh transaction together. We look forward to continuing to grow our partnership and pursuing future opportunities as they arise."