Lone Star Offers Brexit Get Out Clause to London Home Buyers

A venture between Lone Star Funds and Oakmayne Properties is offering a “Brexit Guarantee Pledge” for homebuyers at a London project as the looming vote on Britain’s membership of the European Union damps demand.

“If they don’t like the result, whichever way it goes, they will have the right to withdraw and have their reservation fee refunded in full,” David Humbles, managing director at Oakmayne Properties said in an e-mail. Prices at Two Fifty One will start at 655,000 pounds ($948,500) for a one-bedroom home in the new phase, according to Oakmayne.

Buyers will be offered a reduced rate on those homes at 251 Southwark Bridge Road at a sales offering on 25 May in return for a down payment that can be returned after the vote, Humbles said. Lone Star declined to comment.

Demand for U.K. homes dropped in April, the first monthly fall since March 2015, as the political uncertainty and an increased sales tax on landlords and second-home buyers hurt demand, according a Royal Institution of Chartered Surveyors report published on Thursday. Surveyors expect London will see the biggest fall in homes sales of any U.K. region in the next three months, according to the RICS poll.

“Volumes in prime London are low, partly due to Easter holidays, and also due to uncertainty caused by Brexit,” Robert Green, a director at broker John D. Wood & Co., said in the report. “Transaction costs continue to be a drag also.”