Gaw Capital in mammoth £500m London development

A consortium led by the Hong Kong-based firm is to acquire the Google-let office development in the largest single-asset deal in London’s West End in recent years.

Gaw Capital is reportedly leading a consortium of private Asian investors to buy a 480,000 square foot London office development let to Google for around £500 million (€682 million; $774 million) at a net initial yield of just over 5 percent.

According to news service CoStar News, contracts have exchanged on the off-market deal for which the Hong Kong-based private equity real estate firm is acting as adviser and co-investor. The transaction, due to complete next month, would be the biggest single-asset investment deal in London’s West End in recent years.

The office development, 123-151 Buckingham Palace Road in London’s Victoria, are interlinked but effectively two separate assets. Approximately 97 percent of the rent on the properties comes from tenants Google, PA Consulting, Eni and Sky Media.

The two properties have been trading hands in recent years with Divco West, the San Francisco-based real estate investment, agreeing to buy 123 Buckingham Palace Road for around £200 million only last year.

Malaysian hajj pilgrims fund Lembaga Tabung Haji completed its acquisition of the 151 Buckingham Palace Road from Ivanhoé Cambridge in March 2013, for around £205 million.
Gaw has been busy purchasing properties in London in recent times. Notably, the acquisition of Milton Gate office complex for around £198 million on behalf of Chinese life insurance group, Taikang Life Insurance, in January.

The firm also advised Ping An Insurance, one of China’s largest insurance companies, on the £327 million purchase of Tower Place from Deutsche Asset & Wealth Management.

In September last year, Gaw also led a group of Korean investors, including the Korean Teachers’ Credit Union, on the acquisition of the Exchange Tower in London for £191 million. The seller of the 490,000 square foot office redevelopment site was BlackRock, which had acquired the asset via its BlackRock Europe Property Fund in 2010.