Cordea Savills, the international property investment manager, has purchased the Vue Cinema in London’s Leicester Square for £23.46m on behalf of a UK pension fund client.

The nine-screen cinema, seating 2,500 people, lies in the heart of London’s West End. It was rebuilt behind the Art Deco façade in 1993 and is the only remaining multiplex on Leicester Square.

The asset is the first to be purchased as part of a new mandate of £100m to be invested in properties with Retail Prices Index (RPI) or fixed rental increases.

The property comprises a 22 year leasehold interest from freeholders Gascoyne Estates and is being acquired at an initial yield of over 8.25 per cent with fixed annual rental increases of 2 per cent.

Lucy Winterburn, director of Investment, said: “The robust fundamentals of the location and covenant plus the attractive leasing structure should make this asset a strong performer relative to our client’s performance objective.”

Cordea Savills was advised by Cortex Partners, with Fineman Ross acting on behalf of the vendor, Helix Property Advisors.