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GIC confirms Broadgate acquisition

The Singaporean sovereign wealth fund has acquired 50 percent of the London office complex from Blackstone, its second UK RE deal this year.

GIC Private, the Singaporean sovereign wealth fund, has confirmed its acquisition of Blackstone’s 50 percent stake in City of London office complex Broadgate.

The size of the transaction was not disclosed, but the deal was reportedly valued at more than £1.7 billion (€1.98 billion; $2.66 billion). The deal includes a 50 percent stake in 5 Broadgate, a new building comprising 710,000 square feet pre-let entirely to UBS AG. It is slated for completion in 2015.

Including 5 Broadgate, the complex comprises 17 office buildings as well as retail and other leisure amenities. The other 50 percent of the 4.7 million square foot complex will continue to be owned by UK REIT British Land, which also acts as the asset and development manager of the estate.

Since making its investment in 2009, Blackstone has particularly focused on refurbishing the estate, and retaining UBS as an occupier. These successes “reinforced Broadgate’s position as an iconic estate in the City of London,” according to Ken Caplan, head of Europe real estate for Blackstone, which is relinquishing control of the building even though it has further value-added potential.

Confirming as much, GIC Real Estate’s regional head, Christopher Morrish, added: “The estate will give us an attractive combination of stable long-term income with the potential to create additional value through active management, repositioning of the office buildings and by enhancing the retail and leisure offer. These efforts will retain Broadgate’s attraction to a broad range of international occupiers.”

Founded in 1981 to manage Singapore’s foreign reserves, GIC has been investing in real estate since 1982. Formerly known as the Government of Singapore Investment Corporation, GIC currently has a 10 percent allocation to real estate.

In January, GIC also committed to a UK real estate debt platform, agreeing to underwrite £1 billion of loans sourced by London-based Laxfield Capital.