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BT let confirms property revival: Rent of pounds 1.89m will give Argent 8% yield

THE announcement of one of the biggest office pre-let agreements for several years and the planned construction of a pounds 100m shopping centre yesterday provided further evidence of the gathering momentum of the property revival.

Argent, the property company that came to the market in June with a pounds 140m price-tag, has agreed terms with BT to occupy a planned 120,000 sq ft (11,148 sq metre) office building at its Brindleyplace development in Birmingham.

The letting is the first at the 17- acre (6.87 ha) site, which Argent acquired from the receivers to Godfrey Bradman's collapsed developer Rosehaugh.

At an initial annual rent of pounds 1.89m, the property will give Argent an 8 per cent yield on its estimated pounds 22m development cost. It is expected to be valued at pounds 26m.

Interest in the Brindleyplace scheme is seen as an indication of the shortage of modern office space in Birmingham, where it is estimated there is less than 100,000 square feet of new facilities.

Argent recently announced British Airways Pension Trustees funding for another of the nine proposed office buildings at Brindleyplace.

Meanwhile, Yorkshire Water and Evans of Leeds are teaming up with Land Securities, the UK's largest property company, to build a pounds 100m, 600,000 sq ft shopping centre on the edge of Leeds. The project gained planning approval in 1991 before a Department of the Environment decision to clamp down on out-of-town shopping.