Deutsche Bank Fund Buys $537 Million London Office Projectby
Deutsche Bank AG’s asset-management unit agreed to buy a building that will house the Financial Conduct Authority in London’s Stratford district for more than 370 million pounds ($537 million).
The Deutsche Bank unit will buy the 19-story property, which is under construction, on behalf of one of the lender’s German funds, Deutsche Bank and sellers Lend Lease Group and London and Continental Railways said by e-mail on Tuesday.
“Buying this building is a great opportunity to invest in one of London’s emerging markets at an early stage and has great potential for strong growth as occupiers are attracted by the diversity and vibrancy of the area,” James Petit, Deutsche Bank’s head of real estate for the U.K. and Ireland, said in the statement.
The FCA, will regulates financial markets in the U.K., is due to move into the property in east London in 2018.
Companies are moving out of central London after a shortage of office space caused rental prices to surge. Average office rents in Stratford are around 30 pounds to 40 pounds a square foot compared with 65 pounds to 70 pounds for similar properties in the City of London financial district, according to estimates by Mat Oakley, head of European commercial research at Savills Plc in London.
A unit of Legal & General Group Plc last week bought the Transport for London building at the development next to London’s Queen Elizabeth Olympic Park from Lend Lease and LCR for 246 million pounds.
The U.K. real estate business of Deutsche Bank’s asset management arm had 5.4 billion euros of assets under management as of Sept. 30, according to the statement.