Private equity real estate firm Gaw Capital Partners has added another $921 million in new deals to its growing list of cross-border property acquisitions by picking up an office block in London and a hotel in Singapore, according to media reports.
The prolific Hong Kong-based firm is said to have led the purchase this month of a 44,600 square metre (480,000 square foot) London office complex that is home to US tech giant Google for £500 million ($775 million), together with unnamed Asian investors.
The UK acquisition was preceded last month by the group’s apparent acquisition of boutique hospitality property the Big Hotel in Singapore for S$203 million ($146 million), as was reported in the Straits Times today.
The London and Singapore deals are the latest in a burst of activity from Gaw Capital, as the family owned firm plays an increasingly active role in cross-border acquisitions by Asian investors, particularly from Korea and mainland China.
Chinese Investors Head for London’s West End
In London, a consortium of private investors led by Gaw has now exchanged contracts to purchase a pair of inter-linked office buildings at 123 and 151 Buckingham Palace Road in London’s West End from US fund manager Divco West which owns #123, and Malaysian fund Lembaga Tabung Haji which owns #151, according to a report on real estate industry platform CoStar.
The transaction, which is expected to be completed in one month’s time, is said to be the largest investment deal in London’s West End this year. The deal is said to provide a net initial yield for the new owners of just over 5 percent, thanks primarily to office rental income from tenants including Google and Sky Media.
While Gaw has joined with investors from Hong Kong, mainland China and Korea in making acquisitions in recent years, in London it has teamed with Ping An Insurance Group, one of the mainland’s largest insurers, on two previous office deals.
In 2013 Gaw brokered Ping An’s maiden overseas investment when the mainland group purchased the Lloyd’s of London building in London’s financial district for ₤260 million ($402 million). The two companies teamed up again in January of this year for the ₤327 million ($506 million) acquisition of Tower Place in London.
Divco West acquired 123 Buckingham Palace Road last year for around £200 million, while Lembaga Tabung Haji bought #151 from Canadian fund management firm Ivanhoe Cambridge in March 2013 for £205 million.
Buying a Boutique Property in SG’s Bencoolen Area
In Singapore, Gaw appears to be expanding its portfolio of hospitality assets by adding the boutique hotel at 200 Middle Road, at the intersection with Bencoolen.
The 308-room, 16-storey property has apparently been on the market since shortly after it opened in May 2013. Local developer Andy Ong, who converted the 8,800 square metre (94,657 square foot) property from an office block, first began inviting expressions of interest from potential buyers through Colliers in July 2013. Then in September 2014, JLL posted it’s own notice that it had been appointed as the exclusive agent to market the freehold property on a sale-and-leaseback basis.
The hotel finally found a match on September 18th apparently, when a company named GCH, one of the directors of which is Gaw Capital president and managing partner Kenneth Gaw, filed a purchaser’s caveat with Singapore’s Land Register to purchase the property for S$203 million, according to the Straits Times report.
The other two directors in GCH are Alan Lee Kam Hung and Lee Wei Hsiung. When contacted by the Straits Times, a representative of Gaw Capital is said to have commented that it was, “a bit too early for us to talk about this project, especially now (as) the transaction has not been closed yet.”
Gaw Family Likes Asia’s Hotel Market
The private equity real estate firm made headlines internationally in July when it fronted the $938 million acquisition of the Intercontinental Hong Kong Hotel by Korean sovereign wealth fund KIC.
Then this month Gaw is said to have acquired an office building in Seattle for $49.5 million, after it led the $711 million purchase of Seattle’s Columbia Center in August.
The Gaw family has a long history with hotels and has been moving aggressively in recent years to expand its roster of hospitality assets.
The father of Gaw Capital partners, Goodwin, Kenneth and Christina Gaw, acquired a stake in Rangoon’s iconic Strand Hotel in 1992 that the family eventually expanded to a 50 percent holding. Over the years the company has built a hospitality portfolio of 18 properties in Asia and the US, which includes properties under its own Hotel G brand in Bangkok, Pattaya, Hong Kong, San Francisco, Suzhou, Shenzhen and Beijing.