Norway’s sovereign wealth fund has invested in the UK with the acquisition of a 25% stake in a £2.7bn (€3.2bn) mixed-use portfolio in London’s Covent Garden, as part of a broader European real estate investment deals of more than €900m.
Norges Bank Investment Management (NBIM) is investing £570m for the quarter stake in the Covent Garden portfolio, with Shaftesbury Capital retaining the remaining 75% stake and continuing to manage the assets.
The 1.5m sqft portfolio of mainly retail and leisure assets in Covent Garden and Seven Dials, carries £380m in existing debt, NBIM has said, adding that no financing will be involved in the transaction.
In a separate deal, the manager of the NOK19trn (€1.64trn) Norwegian Government Pension Fund Global has also agreed to acquire a 40% interest in a €1.3bn AXA IM Alts-managed platform holding student housing and co-living assets in France and Spain.
NBIM said it will invest €240m for the stake in AXA Lifestyle Housing, the owner of The Boost Society. The AXA IM Alts-managed European Student Accommodation Venture will retain the remaining 60% of the portfolio of 42 assets, which has approximately €600m in debt.
The London deal strengthens NBIM’s mixed-use portfolio in the UK capital. In January, the sovereign fund acquired a 25% stake in a £1.22bn property portfolio from Grosvenor for £305.7m. The 2.3m sqft portfolio consists primarily of office and retail assets concentrated around Grosvenor Street and Mount Street in London’s Mayfair.
In November last year, NBIM – which holds a majority stake in The Pollen Estate – invested £81m to acquire an additional 10% stake in the 35-acre property in London. The deal valued the 750,000sqft estate of office and retail space at £794m, including existing debt. NBIM initially acquired its majority 58% stake in The Pollen Estate in 2014.
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