Aviva Tower goes on sale for EUR 337m

The Aviva Tower in London - a property in the failed White Tower 2006-3 plc commercial mortgage-backed security issue - has been put up for sale for £284 mln (EUR 337 mln), marketing agent CBRE announced on Monday.

The 23-storey tower, which is leased to insurer Aviva, is just the latest in a string of high-profile offices in London to fall victim to the financial crisis. The tower formed part of Syrian-born tycoon Simon Halab's London property empire before he was declared bankrupt in April last year.

The £284 mln (EUR 337 mln) guide price equates to an intial net yield of 5.5%. According to those who track the market, the tower could appeal to pension funds, which were very active buyers in London last year. Overall, overseas buyers dominated the London market in the fourth quarter last year, accounting for 54% of Central London deals, according to CBRE.

However, in a statement, CBRE noted that 'this quoting price is intended only as a guide to the level of offers that may be taken seriously in the sales process and should not be taken to represent the expected sale price for the Aviva Property, which may ultimately be higher or lower than the quoting price. As with any property transaction, there can be no certainty as to whether any acceptable offers will be received'.

This is the last of Halabi's nine properties backing the CMBS to be put up for sale. CBRE Loan Servicing placed the other eight buildings on the market last March in a bid to repay creditors after the bonds issued by Halabi defaulted in mid-2009. Last July, a fund managed by Carlyle Group snapped up six London offices formerly owned by Halabi for £671 mln - the US-based private equity group's first major purchase in the UK for two years.