Aberdeen sells Oxford St property at ‘significant discount’

Martin Gilbert Aberdeen

Aberdeen’s UK Property fund has sold an Oxford St property at a “significant discount” as it suffers liquidity pressure from post-Brexit redemptions.

Norway’s sovereign wealth fund purchased the property, at 355 Oxford St, for £124m approximately two weeks after UK voters decided to leave the European Union, Bloomberg reports.

Karsten Kallevig, chief executive officer of Norges Bank Real Estate Management, said in an interview this week that the deal “may have been the fastest transaction we’ve ever made”.

He added that the Norwegians got a “significant discount” due to the liquidity pressure Aberdeen faced.

However, a spokesperson from Aberdeen argues the price was “close” to the team’s valuation and a “significant premium” to the purchase price.

The Aberdeen fund bought the property, which is occupied by Boots, in 2011 for £76m. It was reportedly worth £150m at the time of sale and was the largest holding in the property fund.

“It has been a strong performer for the fund and importantly the fund’s investors,” the spokesperson said.

In July, it was reported that Aberdeen also sold an office block at 10 Hammersmith Grove for £89m – an £11m discount.

Aberdeen is also selling BT’s National Distribution Centre at Magna Park in Lutterworth, Leicestershire.

The Norwegian wealth fund already owns properties in Mayfair and Regent St. It independently cut the value of its entire UK real estate by 5 per cent following the vote, wiping 2.3bn krone (£210m) from its balance sheet.

Regardless, Kallevig says London will remain an important city in Europe for the foreseeable future.