Chinese seal Chiswick Park deal in London for €940m

China Investment Corporation has reportedly completed the acquisition of Chiswick Park in west London for around £780 mln (€940 mln), in one of the UK’s largest single-asset deals in the past five years.

According to a news report by PropertyWeek, vendor Blackstone will continue to asset manage the 1.3 million sq ft business park and has also retained the 334,000 sq ft Building 7.

The US private equity group put the asset on the market at end-2012 for £785 mln (€945 mln), just 18 months after having bought the asset for £480 mln from a consortium of Aberdeen Asset Management, Schroders and Stanhope. The deal reflected a yield of 6.6%.

In May last year Blackstone refinanced the asset with a €711 mln loan from Deutsche Bank and Apollo Global Management. Deutsche Bank advanced a new £400 mln senior loan facility, with an additional £200 mln mezzanine facility provided by Apollo Global Management on behalf of a separate managed account.

Chiswick Park is a 121,000 m2 Class A office park located in west London. It was designed by leading British architect Richard Rogers and houses the global, European or UK headquarters of 33 organisations.

Eastdil Secured acted as financial adviser to Blackstone on this transaction.

Agent CBRE managed the sale process.

Chiswick Park is one of the premier office parks in Europe and serves as the European and UK headquarters for more than 20 companies, including Paramount Pictures, Discovery Channel and Tullow Oil.

Set in 33 acres, the park has planning consent for over 1.8 million sq ft (167,000 m2) of office and mixed-use accommodation including retail, gym and health club facilities.

CIC owns a stake in Blackstone, having invested $3 bn into the private equity group before its initial public offering in 2007. In late 2011 the sovereign wealth fund also invested alongside Blackstone in a £1.4 bn UK property loan portfolio being sold by the Royal Bank of Scotland. It bought a 12.5% stake in the equity of the loan portfolio for about £50 mln.

CIC's purchase in London is the latest in a string of acquisitions completed by Chinese investors and developers in London, including those of Dalian Wanda and ABP. Also this week, Chinese developer Greenfield entered the UK with the purchase of the Ram Brewery development site in London from Minerva representing an investment of around £600 mln.

The wave of foreign investment into the UK capital pushed 2013 volumes in central London to a six-year high of £20 bn. The figure is the highest since 2007 and represents a nearly 50% increase on the 2012 level of £13.5 bn, according to agent C&W.