Hong Kong-listed property giant, Chinese Estates Holdings, has sold an office building in London's Mayfair district to London-based Oval Real Estate for £125.4 mln (€147 mln).
This represents a 7% discount on the original asking price of £135 mln (€158 mln).
The decision to sell the property, located at 14 St George Street, comes after occupancy rates plummeted from 98.5% in 2023 to 81.7% in the first half of this year. The property was first put on the market just two months ago.
Oval Real Estate declined to comment on the acquisition.
In a filing, Chinese Estates said: ‘The Disposal allows the Group to re-allocate the proceeds for other investment opportunities when they arise and adjust if needed, the overall strategy on its investment portfolio when the market conditions warrant.’
Chinese Estates originally paid £121.7 mln (€142.7 mln) to acquire the asset from UK investment firm Aberdeen Asset Management in 2016.
As part of the deal, Oval Real Estate will assume the property's existing financial obligations, including a £22.9 mln (€26.8 mln) bank loan and £96.4 mln (€113.0 mln) in debt owed to related companies. Chinese Estates plans to use the net proceeds of approximately HK$ 1 bn (€117 mln) from the sale to fund general operations. The company anticipates a net loss of HK$ 4.3 mln (€502,000) as a result of the transaction.
The property is located just a five-minute walk from both Bond Street and Oxford Circus Underground stations. Situated at the crossroads of St George Street and Maddox Street, the building spans five floors and a lower ground level, offering a total net internal space of 4,818 m2.
The property sale came just a day after Chinese Estates reported that it swung from a HK$ 147 mln (€17 mln) profit in H1 2023 to a HK$ 422 mln (€49 mln) loss in the same period this year.
