A Hong Kong property developer has confirmed the near completion of its almost $1.5 billion purchase of London’s “Cheesegrater” tower, as it takes advantage of the pound’s slump to snap up addresses in the British capital.
C C Land’s acquisition of the 224-metres-high Leadenhall Building, which earned its nickname from its wedge shape, is the biggest single property purchase in the UK since 2014, when a Qatari wealth fund bought London’s HSBC Tower for £1.2 billion ($1.5 billion at current exchange rates).
The deal takes advantage of the slump in the pound, which plunged after the country voted to leave the European Union in June 2016 and is currently trading roughly 12 percent lower against the dollar.
“Devaluation of the pound sterling is one of the major factors to draw interests to this market,” C C Land said in a filing to the Hong Kong stock exchange on May 1, confirming the $1.47 billion purchase from real estate giant British Land and Oxford Properties.
“Both leasing as well as investment demands in prime office buildings have remained strong,” the firm said in the filing.
Britain’s economic growth has slowed to its weakest pace in a year, as the country prepares for a general election overshadowed by its planned exit from the European Union.
But C C Land said London was still an attractive place for investors from around the world, particularly from the Asian region.
The Hong Kong-based firm said the purchase was part of their business strategy “in investing in quality property developments in mature cities globally” and that it would generate “stable and strong recurrent income”.
Completion of the deal is subject to the passing of the resolution by C C Land shareholders at an upcoming special general meeting on May 18.
Chinese and Hong Kong investors spent £2.9 billion ($3.7 at current exchange rates) -- more than buyers from any other region—on central London offices in 2016, broker Knight Frank said in a February report cited by Bloomberg News.
Other investors have also said they will be investing in a post-Brexit UK.
Qatar announced in March it will invest $6.23 billion in energy, infrastructure, real estate and services within five years.
Construction of the Leadenhall Building, the tallest in the City of London business district, was completed in 2014 but was officially opened during a ceremony in 2015 attended by Britain’s Prince William and Prince Harry.
The building’s unusual shape is a result of London’s strict rules on protected sightlines.
Tenants include insurers Aon and MS Amlin and the building’s architects, Rogers Stirk Harbour and Partners.
The building was part the city’s biggest architectural shake-up since the 19th century when a new wave of high-rises built in the financial quarter reshaped the skyline.