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Chinese Set to Buy London Cheesegrater Tower for $1.27 Billion, CoStar Says

Property Markets / Transactions

England

Feb 28 2017

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Jack Sidders  and Ross Larsen, Bloomberg

An investment company of Chinese property magnate Cheung Chung Kiu is set to buy the London skyscraper nicknamed the Cheesegrater for about 1.02 billion pounds ($1.3 billion) from owners British Land Co. and Oxford Properties Group Inc., CoStar News reported.

The deal would be the biggest single property purchase in the U.K. since 2014, CoStar reported late Monday, without saying where it got the information. The Chinese company beat state-owned rival bidders Korea Investment Corp. and Temasek Holdings of Singapore to secure the deal, according to the report.

British Land and Toronto-based Oxford Properties are in advanced negotiations to sell the building, the U.K. real estate investment trust said in a statement Tuesday, without naming the buyer. It said a deal wasn’t certain. Bloomberg reported earlier this month that Cheung’s Hong Kong-based property vehicle, C C Land, was in talks to buy British Land’s 50 percent stake in the tower, formally known as The Leadenhall Building.

British Land’s shares rose as much as 1.7 percent to the highest in more than a month. The REIT wouldn’t comment beyond the statement, while Oxford Properties, CC Land and Temasek declined to comment.

The Cheesegrater has achieved record rents for the City of London financial district of more than 100 pounds per square foot and is leased to tenants including Aon Plc. and Amlin Plc. British Land plans to use the money raised from the sale to finance the construction of an office building at the Broadgate complex, next to Liverpool Street railway station.

Chinese and Hong Kong investors spent 2.9 billion pounds -- more than buyers from any other region -- on central London offices in 2016, broker Knight Frank said in a Feb. 1 report. C C Land agreed last month to buy an office building in the U.K. capital for HK$2.9 billion ($374 million).

SOURCE: Bloomberg

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