Japanese investor Daibiru has acquired Barings’ Capital House at 85 King William Street, EC4, for £169m, adding to the recent inflow of Japanese money into the capital.
The sale comes after Barings acquired the asset from DWS Group in 2021 for £130.5m and subsequently invested more than £11m through an asset management programme.
The nine-storey building now includes a refurbished ground-floor reception, new terraces and six refurbished office floors.
It comprises 121,489 sq ft of office space spread across its eight upper floors, with the ground and lower-ground floors dedicated to retail, currently let to Pret and Sainsbury’s.
The office space is let to seven tenants across 11 leases, with occupiers including Rothschild and Redburn, part of multinational investment bank Rothschild & Co.
RX advised Barings on the sale and Savills advised Daibiru, while CMS acted as property and corporate legal advisers for Barings and Clifford Chance provided legal advice to Daibiru.
Gunther Deutsch, managing director, head of European transactions and country head of Germany at Barings Real Estate, said: “This sale is a testament to our local teams, be it the asset management team transferring this asset into a class-A building, or the transaction team concluding this core transaction in a not yet fully recovered core market.
He added: “This transaction highlights why select office opportunities, in the right locations and with the right amenities, remain among our preferred investments across Europe, whether through developer JVs, refurbishments or change of use transformations that create strongly in demand high-quality office space.”
Total investment for the 2024 in central London reached just £9.2bn according to BNP Paribas Real Estate, while office investment hit its lowest for 15 years, according to Knight Frank’s The London Series report.
The recent flow of Japanese investment into the capital, compounded by Daibiru’s acquisition, offers a source of optimism as London’s capital markets continue to recover from its previous lacklustre year of investment.
Earlier this year, Sotetsu Urban Creates and Yasuda Real Estate company purchased a 20% stake in 21 Moorfields, EC2, from Lendlease, which acquired the building from Landsec for £809m in 2022. The 564,000 sq ft building completed last year and is the UK HQ of Deutsche Bank, which prelet the building on a 25-year lease in 2017.
Around the same time, Mitsui Fudosan UK announced it was making its first foray into the UK’s life sciences sector with a £1.1bn extension of the British Library in King’s Cross, which is to be managed by the company’s frequent partner Stanhope.
Sumitomo Mitsui Trust Bank also announced that some of its private clients had bought a 238,874 sq ft office tower at One Portsoken Street in Aldgate, E1, for more than £160m.
Image from Barings
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