Hong Kong’s Bossini Heirs Snap Up Office in London’s West End for $89M

Hong Kong developer K&K Property Holdings started off 2022 by picking up an office building in London’s West End from Sweden’s Stockholms Enskilda Bank for £66.1 million ($89 million), according to law firm Mayer Brown, which advised K&K on the deal, as Asian investors ramp up their UK real estate purchases.

Led by Bossini heir Raymond Law and his son Kino Law, K&K made 15 Adam Street the firm’s fourth acquisition in the prime area within a two-year period, bringing the investment value of the privately held firm’s London portfolio to £380 million ($513 million).

“The group has always been optimistic about commercial projects in London and intends to expand its property investment portfolio in the UK for long-term investment purposes,” Kino Law, co-founder and chief executive of K&K Property, said in an interview with a Hong Kong newspaper. “The property is strategically located and provides stable income with long-term high returns. The group will continue to search for new investment and develop different types of commercial projects, and will actively increase its land reserve.”

The news of K&K’s purchase of the seven-storey grade A building come as Asian buyers continue to scoop up office assets in west London, with ARA Asset Management’s European branch ARA Dunedin teaming up with South Korea’s NH Investment & Securities last December to purchase a commercial project for £280 million ($373.1 million) and Hong Kong-listed Kerry Properties acquiring an office block for $199 million in September.

Building a UK Portfolio

Located at the junction of Adam Street and The Strand, K&K’s newly acquired asset spans a gross floor area of 54,000 square feet (5,016 square metres), including office space of 34,000 square feet and retail area on the ground floor of 15,300 square feet. The building’s occupancy rate is 87 percent, while the annual rental return is 4.5 percent as of 26 January, according to a source familiar with the deal.

Within a six-minute walk of King’s College London, the latest acquisition of the father-son tycoons sits less than a mile away from the other three assets in their UK portfolio. The group made its debut in the world’s most expensive office market in 2019 with a £130 million ($175 million) office acquisition in Covent Garden, just a year before it bought another two office properties for a total of £180 million ($244 million) in the neighbourhood.

Ranked as Hong Kong’s seventh-richest family as recently as the 2017 Forbes list, the Laws are still looking to generate wealth, with their UK portfolio now boasting nearly £380 million in investment value and a total occupancy rate of 93 percent, producing rental income of £18.6 million a year.

K&K, which was among the bidders for a site at Hong Kong’s former airport Kai Tak in 2019, has long been an active investor in its homeland, with seven residential projects now in its portfolio. The group’s track record elsewhere in Asia Pacific includes a couple of luxury hotels in prime areas of Singapore that were divested to SGX-listed Ascendas Hospitality Trust in 2013.

Mainlanders Seek Exit

Despite an army of South Korean and Hong Kong investors getting a slice of the London market in the past two quarters, the only Chinese developer to bet on a new project in January was Nan Fung’s European investment arm Endurance, which made an off-market purchase of a conference venue in the City of London for an undisclosed amount.

The low-key transaction was reported only a month after Guangzhou-based Poly Real Estate attempted to sell its 2019 office acquisition in the city’s financial district to an unnamed buyer from Hong Kong, according to industry sources who spoke with Mingtiandi.

China’s third-biggest developer, Vanke, which has been looking to tighten its belt, announced last week that it was offloading its office investment in London’s West End to UK-based M&G Real Estate for £132 million ($178.2 million), bringing home a moderate gain after agreeing to buy the property from Henderson Investor in 2016 for £115 million ($154 million).

While London is still under travel restrictions, James McCluskey, a Knight Frank partner on the West End capital markets team, sees Hong Kong investors remaining active in the market.