Chinese Bid for Chiswick Business Park

Could be largest UK property deal since financial crisis

The Financial Times has reported that China’s sovereign wealth fund is one of three Asian investors interested in buying Chiswick Business Park.

If the purchase was to go through it would be the UK’s largest property deal since the start of the financial crisis. The office complex is current owned by Blackstone, the US private equity firm, and the sale price is likely to be £800 million.

China Investment Corporation (CIC) has tabled a bid for the 1.1m sq ft development along with government-backed funds from South Korea and Malaysia according to sources quoted by the FT. CIC is believed to be working in partnership with a third party investor.

The Korean and Malaysian bids involve consortiums of sovereign wealth and pension funds from the respective countries according to the FT. There is also rumoured interest in bidding from Canadian pension funds and UK institutional property investors.

The purchase would continue the trend of heavy investment in the London commercial property market by sovereign wealth funds.

Blackstone, which is 9.6% owned by CIC bought the development for £480 million at the beginning of 2011 from a consortium of Aberdeen Asset Management, Schroders and Stanhope.

A report by Cushman & Wakefield, the property advisory group states that Asian investors have made up the largest foreign buyer group coming into London, accounting for 45 per cent of all deals by value this year.

December 28, 2012