A British estate agent is offering rental returns guaranteed for 10 years at a London development - the first time an agency has offered such a guarantee for flats sold off-plan in Britain.
Asian investors have bought 80 per cent of the units sold at the development since marketing started late last month.
Estate agency Hamptons International is offering buyers at the 18 Alie Street development in Whitechapel, east London, yields of 6 per cent gross, guaranteed for 10 years.
A corporate tenant, it says, has agreed to rent all 25 flats for 10 years when it is completed in the spring of 2012. The agreed rent level will rise with inflation, but not less than 3 per cent or more than 5 per cent each year. Investors can pull out of the deal at three, five or seven years during its 10-year term.
Matthew Tack, the global investments and asset management director at Hamptons, said his agency was the first to offer a guaranteed rental package on an off-plan scheme. Normally, it is developers that offer rental guarantees.
Hong Kong investors have bought nine units at 18 Alie Street since it was launched here on November 19. Singaporean investors have bought 11 units. Tack said 90 per cent of the buyers were investors.
