Regional Office Income

Outside of London, we didn't believe in skinny yields. We liked full fat yields.

In the regions, Brockton collected high yields from quality assets. From Edinburgh to Leeds to Guernsey via Birmingham and Bracknell, around £300m of office, manufacturing and R&D space was assembled, with c.10 years income to strong credits at running yields that were several times higher than those found in the QE-induced, ZIRP world of fixed income.

Fixed income?…more like nixed income.

And with a prudent amount of leverage applied (which was sized and priced to be more than supported by cashflows), the running RoE’s were comfortably double digit. For all the perceived credit risk and relative illiquidity compared to Government bonds, these levered assets returned capital at around 8-10x the rate of 10 year Gilts.