Portsmouth council is in talks to buy the 600,000 sq ft Lakeside North Harbour office campus in Portsmouth from Northwood for a figure understood to be in excess of £150 million.
A Portsmouth Cabinet meeting has been convened for June 17 to review approval of the acquisition via the council’s capital programme.
No price has been attached to the purchase publicly except the council says it would be ‘substantially in excess of £100m’. Market sources suggest a price in excess of £150m.
The Cabinet meeting seeks to increase the authorised limit for the council’s external borrowing by around £70m to £807m.
Highcross bought the 120-acre site in 2005 from IBM via a sale-and-leaseback transaction. The Highcross business was subsequently bought by US fund manager Northwood for £635m in 2014.
The city of Portsmouth is unusual in that almost its entire office market is located in the campus development outside of the city centre.
The campus was originally developed by IBM in the 1970s. Since 2005 Highcross and then Northwood have developed the asset as an office-led mixed-use campus.
The site comprises 590,000 sq ft of offices, 3,000 parking spaces, an 8,505 sq ft day nursery, an 153 bed village hotel, a Porsche Dealership and 8.7 acres of development land.
Portsmouth council is being advised by Avison Young.