5 U.K. Buildings You Could Buy For Less Than Kylian Mbappé Or Neymar
French footballer Kylian Mbappé is on the verge of being transferred from Monaco to Real Madrid for a world record fee of £160M, plus wages of around £5M a year.
It is an incredible sum for a footballer, almost doubling the previous world record transfer fee. It is even more incredible when you take into account that Mbappé is just 18, and has played only 39 hours of professional football.
But he may not even hold the record for long — this weekend it emerged that Brazilian superstar Neymar may move from Barcelona to Paris St. Germain for close to £200M.
People talk about a real estate bubble, but these deals looks madder than anything done in real estate since the heady days of 2007.
What could Real have gotten if it had decided to spend its money in U.K. commercial real estate instead in the first half of the year? Let’s take a look.
The Copyright Building
Mbappé is one of the most talented young footballers of this or any other generation, having wowed the world with his performances for Monaco on its unexpected run to the Champions League semifinal this year.
But for £166M Monaco could have beaten Union Investment to the punch and bought the Copyright Building from Derwent London. It is in the very fashionable West End district of Fitzrovia and the entire 108K SF building is let to Capita for 20 years, providing rock solid income. Can Mbappé promise the same sort of guaranteed return?
Southside Shopping Centre
Neymar is one of the top footballers in the world, and last season his statistics in La Liga put him alongside the best players in the best league in the world.
And yet the Southside Shopping Centre in Wandsworth is a centre with huge potential for asset management in a wealthy area of Central London, and Invesco Real Estate bought that from Delancey for £150M.
Mbappé’s stats are wonderful. He has scored more goals than legends Lionel Messi and Cristiano Ronaldo had at the same age, indicating incredible promise.
Does the Vauxhall Square residential development scheme, bought by Chinese firm R&F for £150M, offer the same promise? It is right by the Thames on top of a key transport link, and will ultimately comprise 578 apartments. Mbappé would need to outscore Messi and Ronaldo to bag the same number of goals.
Oxford Street portfolio
Neymar has held the hopes of his home nation, Brazil, on his shoulders from the age of 18, when he was anointed as the next leader for the team that represents the world’s most football-mad country. He has carried those hopes well, and can’t be accused of lacking backbone.
But PSG might have been better off following the example of Norges Bank Investment Management and the Crown Estate and buying a stake in a portfolio of four irreplaceable assets in and around Oxford Street that have good potential for asset management. The stake was a snip at £120M.
Hull University student accommodation portfolio
If Mbappé or Neymar ever end up playing for Hull City then things have probably gone very wrong for them.
The same can’t be said of the decision of student accommodation firm UPP, backed by Chinese sovereign fund Gingko Tree Investment, to buy a portfolio of student residences that have great performance figures from the University of Hull.