In a further sign of the surging prices of City office blocks, Evans Randall, the Mayfair-based private investment bank has sold ABN Amro’s City headquarters to Prudential for £46 million more than it bought for two years ago

Prudential is paying £230 million for ABN Amro's London headquarters at 250 Bishopsgate, opposite Liverpool Street Station, compared to the £184 million Evans Randall paid.

Prudential is paying so much for the building that its initial annual return from ABN Amro's rent (yield) is just 3.5 per cent, less than the 5.4 per cent investors in a 10-year government bond would collect.

The bank also took advantage of surging demand for London offices to refinance the Financial Services Authority building in Canary Wharf in a deal which values the building at £230 million, 18 months after buying it for £204 million.

Evans Randall bought the ABN building in July 2005 for £184 million (including a £9 million stamp duty charge), a price which raised eyebrows at the time as it meant a then record low yield of 4.25 per cent.

Today's ABN deal means Evans Randall made a gross profit of 40 per cent and an internal rate of return of 35 per cent.

The FSA refinancing with Credit Suisse means investors will take £20 million of the £34 million of cash back they invested to buy the site at 25 North Colonnade. Evans Randall is holding onto the building as it believes the price of the site has further to rise before it is finally resold.

In February Evans Randall and IVG Immobilien of Germany bought the Swiss Re building at 30 St Mary Axe, dubbed the Gherkin, for £630 million, equivalent to a net initial yield of 4.5 per cent.

In May HSBC sold its headquarters building in Canary Wharf to Metrovacesa of Spain for £1.1 billion on a net initial yield of just 3.8 per cent, rising to 4 per cent next year after paying down acquisition costs.

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