Malaysia’s sovereign wealth fund Employees Provident Fund (EPF) is said to have acquired an office block in the city of London for £330 million ($379 million).
According to Mingtiandi, real estate investment manager CBRE Global Investors (CBRE GI) has, on behalf of the EPF, acquired an office building Premier Place at 7 Devonshire Square, from Morgan Stanley Real Estate Investing, together with the United Kingdom asset management firm Greycoat.
The Malaysian pension fund has not replied to a DealstreetAsia query on the same.
Mingtiandi cited CBRE GI, explaining the investment as driven in part by the lengthy weighted average unexpired lease terms (WAULTS) for tenants currently occupying Premier Place, as well as the nine-storey building’s central location.
“This is an opportunity to acquire a prime office in an excellent location with WAULTS of 15 years and let to two strong covenants. It’s a strong addition to our client’s portfolio” commented CBRE Global Investors senior director Chris Gilchrist-Fisher in the report.
In 2018, EPF with Malaysian state-owned fund management firm Permodalan Nasional Bhd (PNB) jointly acquired the commercial assets at London’s Battersea Power Station for £1.58 billion.
The assets were bought from Battersea Phase 2 Holding Company Ltd, owned by Malaysian property developers, SP Setia, Sime Darby Property, as well as EPF. EPF holds a 20 per cent stake in the holding firm.
It was reportedly said that EPF is keen on increasing its overseas portfolio to diversify its investment risk.
According to EPF announcement in February, its overseas holdings across all asset classes stood at 30.3 per cent and contributed 41 per cent to its gross investment income. External fund managers managed 14.4 per cent of the total funds and contributed 18.3 per cent to income.
“The EPF has always held that overseas holdings are an essential and important part of our overall portfolio, and have already announced on several occasions our intentions to continue these diversification efforts to reduce concentration risks,” the fund Chief executive officer Alizakri Alias said earlier.
He also expects that 2020 to be just even more challenging than 2019, with the full impact of the Covid-19 virus likely to drag down already soft global growth.