CK Asset Holdings Limited announced that CK Steel (UK) Limited, an indirect wholly-owned subsidiary of the company, will sell Bluebutton Holdco 5 Broadgate (Jersey) Limited to the buyer Broadgate Five Holdings (Jersey) Limited for £729 million. Shares are issued and paid in cash. The target company indirectly owns the entire interest in a building named 5 Broadgate in London, England, which includes a number of commercial and office units and parking spaces.
In fact, the property is the building where UBS Group’s London headquarters is located. It was first jointly developed and held by British real estate company British Land Co. and Singapore’s sovereign wealth fund GIC. In June 2018,
CK Asset Holdings Limited bought the building for £1 billion. It was reported at the time that the building’s annual rental yield was about 3.95%.
In 2021, there was news that CK Asset intends to sell the property. According to previous reports by Bloomberg, Cheung Kong has held preliminary discussions with a number of potential buyers, and the buyer will only agree to sell if the buyer’s bid is above the price of 1 billion pounds. Judging from the price of the agreement reached between CK Asset and the buyer, the “psychological price” of CK Asset last year was reduced by nearly 30%.
However, during the epidemic, the demand for iconic London office buildings with long-term leases continued, and investors valued their long-term yields significantly higher than government bond returns. UBS plans to renew the lease until at least 2035, according to a 2018 statement from the property’s developer, British Land Co.