ADIA exits London office property for £145m

The Middle Eastern sovereign wealth fund has sold a Grade A office property in London to a large state-owned Chinese real estate enterprise  

The Abu Dhabi Investment Authority (ADIA), the Middle Eastern sovereign wealth fund, has sold an office property in London to Poly Real Estate Group, a large state-owned Shanghai-based listed Chinese property developer for around £145 million (€191.52 million; $208.63 million).

5 Fleet Place is a Grade A office property located in London’s financial district. The deal is understood to reflect a yield of 4.5 percent.

The freehold building, developed by British Land in 2007, is spread over 130,000 square feet of office space and retail accommodation. The law firm Charles Russell Speechlys is the anchor tenant in the property. ADIA reportedly acquired the building in early 2008 for £112 million and news of the state fund putting up the asset for sale was first made public in July last year.

For Poly Real Estate Group, which appointed JLL to advise on the deal, 5 Fleet Place marks its maiden real estate acquisition in the UK market.

“Poly is delighted with the acquisition of 5 Fleet Place as our first UK investment,” said Arthur Wang, head of the group’s international business in a statement. “We have a solid confidence as well as a long-term business plan in UK which will be along with the future development plan on both city and nation levels, and will commit to produce continuous benefit to clients, business partners and UK society.”

The state-owned enterprise has been increasing its overseas property portfolio, building a steady presence in markets such as Australia. Its first investment in the country was the acquisition of the Cambridge Office Park in Sydney for A$110 million (€69.93 million; $76.13 million) in December 2014, followed by the purchase of a 51 percent stake in a Melbourne development project reportedly for A$19.8 million.