Hong Kong's "king of retail" Lai Wing-To has brought back to market Standbrook House at 2-5 Old Bond Street, seeking around £150 million or a circa 3.5% net initial yield.
The building was the jewel in the crown in a portfolio of prime London assets Lai had been seeking to sell last year via JLL for in excess of £260 million.
The Trinity portfolio comprised three retail-led mixed-use assets in Mayfair and Soho – Standbrook House, 291 Oxford Street and 2 Harewood Place, which neighbour each other, and 147-155 Wardour Street in Soho.
CBRE has now been enlisted alongside JLL to sell Standbrook House, which the veteran investor, when it housed the UK flagship stores of British fashion house Alexander McQueen and Italian shoe brand Tod’s.
Lai bought the 23,625-square-foot office and retail building from NFU Mutual for £152.5 million, a net initial yield of 2.7%. It is understood that the property had been under offer for close to £170 million to the retail tenant luxury Swiss watch company Richard Mille last year, which replaced Alexander McQueen as anchor retail tenant, before the deal fell through.
In 2013, Lai shifted his focus from Hong Kong’s property sector to the retail property market in the UK as a result of tightening mortgage loan conditions. One of the city's biggest individual real estate investors, Lai owns dozens of retail properties in Hong Kong.
The London assets came to market following Lai's decision to sell a batch of commercial properties worth an estimated HK$600 million in Hong Kong’s Causeway Bay and Central districts, with the investor’s HK$460 million oceanfront mansion now also on the block, according to Asian real estate publication Mingtiandi.
Lai will have been following the strong performance of assets selling on London's famous luxury retail thoroughfare.
Prada last month bought Miu Miu's flagship store on New Bond Street from the M&G life fund for around £250 million. The Italian luxury fashion house has bought 150-151 New Bond Street and 40 Bruton Place, the home of women's clothing brand Miu Miu, which it owns. The price represents a yield of around 2% or £12,290 per square foot overall.
Investments on Bond Street have remained in high demand throughout a wider downturn in transactional activity in central London, driven by a continued desire of the world's most famous luxury brands to have an address there.
A critical factor has been luxury retailers buying their own buildings on Bond Street, forcing other brands to look further afield. Examples include Richemont buying 50 New Bond Street with Oxford Properties, while Louis Vuitton, Chanel and Sotheby's have all bought assets on the street.
Swiss luxury goods group Richemont exchanged to buy British jewellery retailer Boodles' flagship store at 178 New Bond Street for £82 million, or a 2.2% net initial yield last year, a speedy re-investment on Bond Street by Richemont which sold 130-134 New Bond Street to Blackstone for £227 million earlier in the year alongside its investment partner Oxford Properties.
CoStar News revealed last year that 126-127 New Bond Street, on London's New Bond Street was selling for around £71 million or a sub-3% net initial yield to the investment company of Sir James Dyson, the household appliances retail and engineering group.