Author Topic: the shift towards foreign ownership is expected to accelerate.  (Read 325 times)

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Offline thaiga

Foreigners hit London for property buying spree

Overseas appetite for London property has gathered momentum in the week before Christmas, with foreign investors hitting the capital for a £1.3bn ($2bn) spending spree.

In a series of big-ticket deals, buyers from across Asia, Africa and Europe have snapped up skyscrapers, upmarket clothes shops and sprawling
The deals will bring cheer to the London property market as it prepares to shut for Christmas.

It also offers a reminder of the continuing lure of the capital’s property market amid turmoil in the eurozone, and heralds a year in which the shift towards foreign ownership is expected to accelerate.

“Buyers are aware that now is a good time to come into the London market as many sellers are distressed or concerned about the impact of the eurozone crisis on future valuations,” said James Beckham, director of capital markets at Jones Lang LaSalle, the property services group.

The most notable deal of the week was the completion of the £282.5m sale of Tower 42, the tallest occupied skyscraper in the City and former headquarters of NatWest bank. It was bought by Nathan Kirsh, the South African property tycoon, from BlackRock and Hermes Real Estate.

A few hundred metres away, the Malaysian government’s investment arm, Permodalan Nasional Bhd, snapped up a 460,000 square foot office complex for £350m. The acquisition of the Silk Street building, which sits in the shadow of the Barbican and is home to law firm Linklaters, marks a UK debut for PNB.

It is not just prime office stock that has attracted overseas interest, however. A property investment vehicle backed by Ernesto Bertarelli, the Swiss-Italian pharmaceuticals billionaire, on Wednesday announced its first investment, acquiring a 186,000 sq ft mixed-used building in Mayfair in a deal rumoured to be worth more than £100m.

LVMH chief executive Bernard Arnault, France’s richest man, is rumoured to have bought three trophy stores on London’s most expensive shopping street for £300m. The Bond Street properties, including Louis Vuitton’s flagship UK store, have been owned by Ireland’s National Asset Management Agency since June.

Martin Jepson, investment and development president at Canadian fund manager Brookfield Office Properties, said London possessed attributes that would protect it from the uncertainty stalking financial markets.

“First and foremost, London continues to be seen as the financial capital of the world and remains a safe haven for overseas money, as evidenced by the number of foreign property transactions in recent months,” Mr Jepson added.

The flow of overseas capital into London’s commercial property market during the past six months has been one of the defining trends in the global real estate industry.

London has absorbed £10.1bn of foreign investment since the middle of the year, more than double that attracted by Paris, which, at £5bn, is the next biggest draw for international capital, according to Real Capital Analytics.
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