Norges Bank, Crown Estate buy leasehold interest for £129m

Norway’s sovereign wealth fund and the UK’s Crown Estate have bought a leasehold interest in a prime commercial building in London for £129m.

Norges Bank Real Estate Management (NBREM), the property investment manager for the NOK7.5trn (€829bn) Government Pension Fund Global (GPFG), and The Crown Estate bought the 68-year leasehold in 10 Piccadilly from UK insurer Standard Life.

NBREM and The Crown Estate, the proceeds of which go to the UK Treasury, made the deal via their Regent Street partnership, in which Norges Bank has a 25% stake.

The Regent Street partnership already owned the 98,660sqft retail and office property, but Standard Life had retained the leasehold interest in the building.

Norges Bank said the partnership could now the manage the property directly.

“No financing was used in the acquisition and the asset is held unencumbered with debt,” it said.

The Piccadilly property has 59,839sqft of offices and 38,821sqft of retail space.

The Regent Street Partnership was formed when Norges Bank made the first real estate acquisition for the GPFG, Norway’s oil fund, buying a 25% stake in The Crown Estate’s Regent Street portfolio in London.

Following on from that deal, Norges Bank and The Crown Estate linked up again in 2014 to buy a majority stake in the Pollen Estate — 730,000sqft of property in London’s West End.