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Taiwan’s Fubon snaps up £320m Madame Tussauds

The Taiwanese insurer is chasing its third London property asset since deregulation in the country’s insurance sector in 2013 paved the way for greater overseas investment.

Fubon Life Insurance Company, the Taiwanese insurer, has reportedly placed tourist hotspot Madame Tussauds waxwork museum under offer for more than £320 million ($486 million; €432 million).

According to UK commercial property magazine Estates Gazette the deal is part of a plan by Fubon to deploy approximately $3 billion into international property markets within five years.

The freehold property on Marylebone Road in central London was put on the block by current owners, London-listed Secure Income REIT, back in February.

Madame Tussauds, which is owned by leisure group Merlin Entertainment, has occupied the current site for more than 130 years and is consistently one of London’s most successful tourist attractions. The lease runs for another 27 years at least with the option for Madame Tussauds to extend it by up to a further 70 years upon expiry, bringing the potential tenancy length to almost 100 years. The current rent payable on the property is £15.5 million a year.

The deal marks Fubon’s third venture in London real estate and follows on from a £139 million deal to buy London-listed property company LondonMetric’s One Carter Lane in November last year; before agreeing a deal to buy Bow Bells House for £197 million a month later.

According to CBRE, the global property services firm, Taiwanese insurers are a significant part of a wider deregulation trend happening among Asian insurers that could result in approximately $75 billion of equity being allocated to real estate by 2018. CBRE predicted other Taiwanese insurance companies would also be among the most active overseas real estate investors as there are few institutional grade properties in the their home market.