Norway’s Government Pension Fund Global has spent £190.6m (€254m) on a London ’trophy’ asset sold by Italian fund management group Sorgente.

Norges Bank Investment Management (NBIM) bought Queensbury House in London’s prime Mayfair district from Sorgente’s Fondo David prestige investments vehicle.

The deal books a considerable profit for Sorgente in a short space of time – having paid £167m at a sub-5% yield in mid-2012 – and is further evidence of the continued rise in London’s capital values, with prime yields on London properties having fallen to below 4% in recent months.

Sorgente, which manages European and US real estate investments for Italian institutional investors, said more than 50 potential investors had expressed interest in the asset. Seven formal offers were examined.

“The management of real estate funds must always seize the best market opportunities to pursue future investments, in the UK as well as other strategic areas, for the group”, said Valter Mainetti, Sorgente chief executive.

Sorgente targets what it deems iconic and trophy assets – increases the value of the managed assets over time. Shortly after acquiring Queensbury House in 2012, director general Stefano Cervone told IP Real Estate that historic and trophy buildings offer a superior risk-return profile because are unique, retain their value better, attract tenants and are very liquid.

NBIM chief executive Yngve Slyngstad recently told IPE that it had “no interest in trophy assets”. He said: ”I don’t know whether you’d call what we have been buying trophy assets. It’s not part of the strategy.”

Slyngstad said: “But it’s right that we have a strategy to invest in core real estate, some of the better office buildings in some of the larger cities of the world.”

The NOK6.62trn (€754bn) Norwegian oil fund has been seeking to build a 5% real estate allocation and has targeted large single and portfolio deals. Real estate was expected to account for 2% of the fund at the end of last year.

As reported, NBIM has been slow to build the oil fund’s real asset exposure due to the need for an in-house team, addressed gradually since investment began in 2010. Assets acquired by NBIM have included office buildings in New York, retail space owned by the UK’s Crown Estate and logistics parks – with all but the latter potentially viewed as trophy assets.

According to advisory firm Savills, of the £21bn (€27.9bn) spent in the London market last year, £14.6bn was attributed to foreign buyers. Chinese and US money will dominate London’s commercial property market this year. The firm says that Chinese investors accounted for more inward investment than all European buyers collectively last year, at £2.2bn.