Ping An Insurance, one of China’s largest insurance companies, has acquired the Tower Place in London from Deutsche Asset & Wealth Management for £327 million (€437.92 million; $491.48 million).
The landmark property located in London’s EC3 insurance district is a Grade A office building spread over 385,000 square feet. It is said to be 99 percent occupied, according to a company statement.
This deal marks the Chinese insurance second real estate acquisition in London. Its first overseas investment was in 2013, when it bought the Lloyd’s Building in London from the German real estate company Commerz Real for £260 million. For both transactions, Ping An was advised by the Hong Kong-based private equity real estate, firm Gaw Capital Partners.
PERE has learnt that 50 percent of the purchase price was funded with debt from the UK bank Lloyds.
The London-based Deutsche Asset & Wealth Management sold the asset on behalf grundbesitz europa, its open-ended real estate fund, which has a total asset value of €4.19 billion and a portfolio of 49 properties.
“We have owned this property since 2003 and it has outperformed our expectations,” said James Petit, head of real estate for UK and Ireland for Deutsche AWM. “Selling has allowed us to capitalize on the interest in London and we will now refresh and rebalance the fund’s UK portfolio. We are already looking at a substitute target asset.”
“We are pleased to work for Ping An insurance again, helping them with this significant UK investment,” said Goodwin Gaw, managing principal and chairman of Gaw Capital Partners. “This transaction demonstrates the trust and confidence of Chinese institutional investors in us. As a company active in the real estate market of Greater China and Asia Pacific, Gaw Capital Partners is dedicated to helping Chinese and Asian investors look for more and more investment opportunities with higher returns in the overseas real estate markets…”
In addition to expanding its overseas footprint, Ping An has also been ramping up its investments within China and Asia. In March last year, it formed a partnership with the Singapore-based real estate firm Ascendas to collaborate on real estate investments in the region through co-investments and RMB-denominated funds. That partnership’s focus is on investing in office and mixed-use properties.