Norwegian sovereign wealth fund Norges Bank Investment Management (NBIM) has acquired a 25% stake in Shaftesbury Capital’s Covent Garden estate.
The transaction values the estate at £2.7bn, in line with its independent property valuation as of 31 December 2024, and the deal is expected to generate gross cash proceeds of approximately £570m.
Shaftesbury Capital will retain 75% ownership and management control over the estate when the transaction completes in early April 2025.
The portfolio has a net initial yield of 3.6%, annualised gross income of £104m and an estimated rental value (ERV) of £134m as at 31 December 2024. The portfolio covers 220 buildings and more than 850 units, providing 1.4m sq ft of space.
Ian Hawksworth, chief executive of Shaftesbury Capital, said: “We are pleased to announce the formation of a £2.7bn long-term, strategic partnership with NBIM. This investment by a leading global real estate investor demonstrates the quality of our portfolio. This partnership brings together two long-term investors who have a shared confidence in and ambitions for the growth prospects of the Covent Garden estate and the West End.
“Through partnering with private capital, this transaction leverages our operating expertise and assets, enhancing growth and expansion opportunities across our portfolio whilst strengthening our financial position and providing significant optionality to the group. As demonstrated by our recent 2024 results, Shaftesbury Capital’s portfolio is anticipated to deliver long-term sustained income and value growth. Backed by a strong balance sheet, we are well-positioned to capitalise on market opportunities in London’s West End.”
Jayesh Patel, head of UK real estate at NBIM, added: “We are delighted to announce our investment into the Covent Garden estate, creating a long-term partnership with Shaftesbury Capital. This investment underscores our belief in the strength of London with the portfolio complementing our other high quality West End investments.
“Covent Garden is one of the world’s most recognised retail, leisure and cultural destinations and we look forward to supporting Shaftesbury Capital’s management team, with their strong track record of delivering the growth potential of this prime West End estate.”
