Oyster sauce group eyes ‘Gherkin’ tower bid
The Hong Kong-based sauces and condiments group Lee Kum Kee has approached the owners of London’s “Gherkin” skyscraper about a potential purchase in the latest sign of east Asian appetite for trophy real estate in the UKcapital. The group is eyeing a bid for the Norman Foster-designed tower, which is owned by Brazil’s Safra Group, said two people briefed on the situation. But they cautioned that the building was not being marketed and there was no certainty of a deal.
Lee Kum Kee, which acquired another London office building in the Docklands area in 2016, has been examining a series of big-ticket London build- ings through agents CBRE, with a view to further purchases, one person said.
The group is considering an offer for the building, formally known as 30 St Mary Axe, at a yield of less than 4 per cent, another person said.
This would reflect a similar pricing level to fellow Chinese company CC Land’s £1.1bn purchase of the “Cheesegrater” skyscraper this year, which encouraged other landlords to consider selling major property assets.
The Gherkin was bought by the Safra Group, controlled by the Brazilian billionaire Joseph Safra, for £726m — a yield of 3.8 per cent — in 2014, after it fell into receivership five years earlier during the financial crisis. One of London’s best-loved landmarks, its main tenant is the reinsurer Swiss Re.
J Safra Real Estate, a subsidiary of Safra Group, said: “The Gherkin is a unique real estate asset and is not for sale.”
Lee Kum Kee had not responded to requests for comment at the time of going to press.
Chinese and Hong Kong companies have emerged as leading buyers of London property in the past 18 months, with purchasers from the region snapping up £ 3bn of buildings in 2016, according to Knight Frank.
Asian appetite for London office buildings has helped to quell fears of price drops after the Brexit vote, with the “Cheesegrater” sale setting records for the City of London. A group of shareholders in the “Walkie Talkie” at 20 Fenchurch Street is also exploring a sale.