London’s Gherkin Tower Offered for Sale by Its Lenders

Savills Plc (SVS) and Deloitte LLP were hired to sell London’s conical skyscraper known as the Gherkin three months after the building’s lenders appointed receivers to end years of defaults.

The plan to sell the 180-meter (590-foot) tower at 30 St. Mary Axe in the City of London financial district was announced by Savills in a statement today.

A fund managed by IVG Immobilien AG, once Germany’s biggest real estate company, and London-based Evans Randall Ltd. bought the building from reinsurer Swiss Re Ltd. for 600 million pounds ($1 billion) in 2007. Part of the IVG fund’s loan was in Swiss francs, which have gained about 59 percent against the pound over the last seven years, increasing the amount owed to the point that it breached rules on how much debt could be held against the property.

“The property will appeal to a wide range of domestic and international investors and we are confident of maximizing returns to the receivers and creditors,” Jamie Olley, head of City investment at Deloitte’s real estate unit said in the statement.

Deutsche Fonds Holding AG, a closely held German company, bought IVG’s private funds management business, including the fund that owns part of the Gherkin, on March 20. Bayerische Landesbank, a closely held bank based in Munich, and its Real I.S. AG unit provided the financing for the Gherkin’s purchase, according to the bank’s 2007 annual report. Savills didn’t identify the lenders in its statement.

To contact the reporter on this story: Patrick Gower in London at pgower@bloomberg.net

To contact the editors responsible for this story: Andrew Blackman at ablackman@bloomberg.net Andrew Blackman, Steve Bailey

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