Strategic sale sees Norwegian sovereign wealth fund acquire 25% stake in iconic London estate
Shaftesbury Capital PLC has entered a strategic partnership with Norges Bank Investment Management (NBIM), selling a 25% non-controlling interest in its Covent Garden estate for approximately £570 million.
The transaction values the West End portfolio at £2.7 billion, in line with an independent valuation by CBRE as at 31 December 2024. Completion is expected in early April 2025. Shaftesbury Capital will retain 75% ownership and full management control of the estate.
The Covent Garden estate includes over 220 buildings and 850 units across 1.4 million sq ft, excluding long-leasehold residential interests. With 74% of its value in retail and food & beverage, and 26% in office and residential, the estate produces £104 million in annualised gross income with a net initial yield of 3.6%.
Ian Hawksworth, Chief Executive of Shaftesbury Capital, said: “We are pleased to announce the formation of a £2.7 billion long-term, strategic partnership with NBIM. This investment by a leading global real estate investor demonstrates the quality of our portfolio.
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.”
Jayesh Patel, Head of UK Real Estate at NBIM, commented: “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... and we look forward to supporting Shaftesbury Capital’s management team.”
Proceeds from the sale will initially reduce net debt, including partial repayment of the Canada Life term loan, and support the repayment of £275 million of exchangeable bonds due in 2026. The transaction is expected to be earnings-enhancing and improve Shaftesbury Capital’s loan-to-value ratio from 27% to 16%.
The partnership aims to unlock future growth opportunities while maintaining Shaftesbury Capital’s control of one of London’s most prominent mixed-use destinations.