China developer eyes £140m Helicon deal
One of China’s biggest developers is lining up a £140m purchase of the Helicon Building in the City of London,Property Week can reveal.
Hong Kong-listed China Overseas Land and Investment (COLI) is under offer to buy the 130,000 sq ft building (pictured) on 1 South Place on Finsbury Pavement from Deutsche Asset and Wealth Management (Deutsche AWM).
Negotiations are at an early stage, but if the deal goes ahead COLI will be the second Chinese investor to land a City of London office asset this year after Poly Real Estate Group acquired 5 Fleet Place for £145m, reflecting a yield of 4.2%, from Abu Dhabi Investment Authority.
A deal for the Helicon Building at around £140m would represent a yield of 4.5% and give Deutsche AWM a tidy profit on the £100m it spent in 2004.
The Sheppard Robson-designed building, which is located at the northern end of Moorgate, was built in 1996 and provides 119,000 sq ft of office space, with retail units on the ground and first floors currently occupied by Marks & Spencer and HSBC.
Deutsche AWM recently carried out a refurbishment of more than half of the eight floors of office space and re-let it to firms including Experian and Tradedoubler, the Chartered Institute of Management Accountants and RSSB. The remaining space of around 60,000 sq ft is let to California-based computer technology giant Oracle.
COLI already owns three commercial properties in London including the nearby 1 Finsbury Circus, which it bought for £152m in December 2012.
The developer also owns 14 Kingsway in the West End, which it acquired in 2013 for £170m, and the former Daily Mail headquarters, Carmelite Riverside, at 50 Victoria Embankment.
COLI purchased HK$42.8bn (£3.8bn) worth of property from its parent company China Construction Engineering Corporation, including the London assets, in March last year, consolidating the group’s real estate assets into a single entity.
In its most recent interim results published in August 2015, the group recorded revenue of HK$64.85bn and profit of HK$23.29bn for the first half of 2015.
Deutsche AWM was advised by JLL. All parties declined to comment.