Chinese life insurance companies are on track to invest close to £1bn in London this year after Ping An went under offer to buy Tower Place, EC3.
China’s largest life insurer has agreed a deal with Deutsche Asset and Wealth Management, which is selling the building on behalf of the Grundbesitz Europa fund.
CBRE began marketing the building for sale this summer with a price tag of £330m, reflecting a 4.57% yield and a capital value of £858 per sq ft.
Marsh and McLennan occupies the entire 384,600 sq ft of the building on a 25-year lease, which expires in 2028.
This is Ping An’s second UK property acquisition, following its July 2013 purchase of the Lloyds Building, EC3, for £260m.
Gaw Capital Partners has advised it on both deals.
Taken together with China Life’s 70% stake in the £795m purchase of 10 Upper Bank Street, E14, earlier this year, the Chinese life insurers have invested £886m so far this calendar year and £1.2bn since July 2013.
Their investment follows a 2012 move by the Chinese government that allowed them to invest in a limited number of overseas markets.
The Taiwanese authorities followed suit with a similar liberalisation last year.
Cathay Life, one of Taiwan’s largest insurers, made its London debut this summer with the £320m purchase of Woolgate Exchange, EC2.
Knight Frank’s head of commercial research, James Roberts, said: “The figures for money coming into London from Greater China and Taiwan plot a real ‘aeroplane take-off’ on a graph – from hugging the ground to high altitude in just a few years.”
