Land Securities Group (LSE:LAND) has exchanged contracts to sell 123 Victoria Street in London for £211m to SevenCitiesLdn, on behalf of Seven Capital.
The 245,000 sq ft office block, built in the 1970s and last refurbished in 2012, carries an estimated foregone net rental income yield of 6.0% over the next five years.
In early 2025, Landsec set out plans to release £2bn of capital from offices by 2030, redeploying it into assets it expects to deliver higher income growth.
The company has now sold more than £1bn of offices since that strategy was announced, having disposed of over £550m as of its last update.
"In total, we have now achieved asset sales of £1bn since we announced our updated strategy in early 2025", said chief executive Mark Allan.
He added that strong customer demand for the company's "best-in-class assets" continues to support like-for-like income growth.
Of the £211m consideration, £181m is due on completion next month, with the remaining £30m payable within 36 months at 6.0% annual interest, above the company's marginal cost of borrowing.
The sale will cut net tangible assets per share by 0.3%.
On a pro-forma basis, initial proceeds will reduce Landsec's loan-to-value ratio, reported at 38.7% in March, by 0.9 percentage points, and trim net debt/EBITDA, at 8.4x, by 0.3x.
Landsec's May results guided to EPS growth acceleration into FY28, a target Allan said the group remains "well placed" to deliver.