Royal London Asset Management is edging ahead in a fierce bidding war for an office and retail block backing on to London's Oxford Street for circa £170 million, or a sub 4% yield, in what would be a bellwether transaction for the market.
Aviva and PSP are jointly selling 11-12 Hanover Square via Knight Frank and Newmark. A number of parties including Aware Super with Delancey and JP Morgan have been circling the opportunity.
It would be a bellwether if RLAM secures the asset as it would indicate UK institutional investor appetite returning for the most prime London assets as well as for retail on Oxford Street.
The circa 70,000-square-foot asset includes a New Balance store onOxford Street as well as offices on one London's most prestigious squares, Hanover Square.
The transaction has been one of the most talked about at the Mipim conference in Cannes, pointing to a consensus that there is increased demand from private equity buyers, alongside increasing appetite from UK funds and select German funds for London offices.
PSP Investments, one of Canada's largest pension investment managers, took its stake in the building when Aviva Investors sold it a 50% stake in a 14-strong portfolio of prime central London property and development portfolio for £500 million in 2015.