Norway's Wealth Fund Said in Talks to Buy Amazon London Office

(Bloomberg) -- Norway’s $1 trillion wealth fund is in exclusive talks to buy a London office building, leased to Amazon.com Inc., for about 330 million pounds ($430 million), two people with knowledge of the talks said.

The fund is close to finalizing terms with Hines Interests LP for the ‘Sixty London’ building in the Farringdon district, the people said, asking not to be identified because the talks are private. It would be the second London office building that the world’s largest wealth fund has invested in this year, underlining the enduring appeal of property in the U.K. capital even as Brexit draws nearer.

Spokesmen for Hines and the Norway wealth fund declined to comment.

International investors are continuing to flock to large London office buildings as prices remain at a discount to other major European cities and a weakening pound further heightens the relative appeal of the U.K. capital. Korea’s National Pension Service agreed to a deal to buy Goldman Sachs Group Inc.’s London headquarters, located across from the building that Norway’s wealth fund is in talks to acquire.

A record 3.6 billion pounds was invested in City of London offices in the second quarter this year, according to data compiled by broker CBRE Group Inc.

Norway’s wealth fund delivered a return of 1.8 percent in the second quarter, after a loss in the first three months of 2018. The real estate portfolio, which includes a stake in buildings on London’s Regent Street and the European headquarters of Bank of America Corp., provided a 1.9 percent return.

There is about 10 years left on Amazon’s lease at the Sixty London building, according to a sales brochure for the property. The online retailer rented the space in 2013 as it moved operations into central London before opening an even larger U.K. headquarters in the city’s Shoreditch district last year.

--With assistance from Sveinung Sleire.

To contact the reporter on this story: Jack Sidders in London at jsidders@bloomberg.net

To contact the editors responsible for this story: Sree Vidya Bhaktavatsalam at sbhaktavatsa@bloomberg.net, Paul Armstrong

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