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Goldman Sachs is one of the few U.S. opportunistic investors putting significant amounts of capital to work in London right now.
North American investment in London was down 69% in 2017 compared to its 2015 peak, according to Real Capital Analytics. For opportunistic and value-add investors, the outlook for rents in many sectors have become less certain, but pricing has not dropped to reflect this.
But Goldman clearly believes it can hit the high returns it typically targets, given some of its recent deals.
The U.S. bank has agreed a deal to buy Vintners Place, a 270K SF office building in the City of London, for around £160M from U.S. investor Crescent Heights, CoStar reports.
The deal is a bet on the London office leasing market. Around 80K SF will become vacant in 2019 when investment bank Jefferies moves to 100 Bishopsgate.
Earlier this year Goldman bought the 105K SF Procession House from L&G for £70M. The majority of the building is let to Goldman itself on a lease it can break in 2019.
Goldman is also making a significant play in the U.K. senior living sector.Goldman is backing developer Riverstone Living on a programme to build up a £2B portfolio of London luxury senior living apartments, according to Estates Gazette.
EG said Goldman and Riverstone have acquired their first site, in Fulham, which will be a 162-flat project, and they want to buy five to 10 sites with the capacity for 150-200 flats each and potential end values of £200M.
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