Hong Kong developer Wing Tai part of joint venture acquiring US$591 million building in Central London
- London offices remain good value with prime yields running at 4.25 per cent this year, according to Knight Frank
- Mainland Chinese and Hong Kong buyers made up 39 per cent of Central London’s office deals by foreign buyers last year
Hong Kong developers are on a shopping spree, buying up London property as they seek higher yields and to diversify risks.
Wing Tai Properties and Manhattan Garments have entered into a 50:50 joint venture to buy a commercial building in the heart of London for £460 million (US$591.1 million), according to a Wing Tai filing with the Hong Kong stock exchange on Friday.
The pair will each contribute £230 million to the joint venture, and Wing Tai’s share of the investment will be funded by “internal resources and/or borrowing”, it said.
Located at 30 Gresham Street, the property provides a total of 403,639 sq ft of office and retail space over two basement, one lower ground, one ground and eight upper floors. There are 48 car parking spaces located on the two basement levels.
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It will “provide an opportunity for the group to expand and diversify its property investment portfolio and generate a steady flow of rental income”, said Wing Tai. Shares in the company eased by 1.65 per cent on Friday after the announcement.
In June, CK Asset Holdings acquired 5 Broadgate, a three-year-old building close to the Liverpool Street railway station with a total gross floor area of 1.2 million sq ft for £1 billion. Nan Fung Development bought a majority stake in UK developer Endurance Land last month to increase its exposure there.