The global pandemic has put a premium on liquidity and when making the sale, the vendors said that "cash is king". The buyer is reportedly a wealth management organisation acting for HNW Chinese families.
An Asian wealth management firm has bought a £94.2 million ($117.5 million) London office building in the capital’s City financial district from China-based vendors keen to build cash amid the pandemic-induced turmoil.
Chuang’s Consortium International and Chuang’s China Investments, which had owned 10 Fenchurch Street jointly, have agreed to sell the building to Retain Prosper Limited, a UK-registered entity, according to a Hong Kong Stock Exchange statement at the weekend from both of the Chuang-labelled organisations. The sale was conducted by an entity called Bizking Limited, which is registered in the British Virgin Islands. Both the Chuang organisations are incorporated in Bermuda.
Mingtiandi, a publication which covers Asia real estate news, said that Retain Prosper is affiliated with Mighty Divine, an investment firm acting for Chinese high net worth families.
The Chuang’s groups had bought the property from Standard Life in November 2016 for £80 million (a few months after the UK’s momentous Brexit vote), the publication said.
The sellers explained that their decision to offload the property was down to their “cash is king” policy in uncertain times.
“Since the outbreak of COVID-19 and the accelerating [number of] confirmed cases across the globe, the macro-economic outlook has become gloomy and uncertain with increasing concerns over investment activities. In the United Kingdom, despite Brexit happened on 31 January 2020, its related uncertainties over regulatory, labour and trade relationships with the European Union affect the businesses and investment sentiment,” the organisations said.
“The Chuang’s China Board considers that the disposal represents a good opportunity for the Chuang’s China Group to lock in its return on the property and enhance its cash position under the current situation,” the statement added.
This publication, taking data from Highworth Research, has noted how family offices have been affected by and are making provisions to protect themselves as a result of the pandemic. (See stories here and here. To register for the Highworth database, click on this link.)