A portfolio of eight London office buildings is to be put up for sale by CB Richard Ellis Group Inc.
The buildings belong to entrepreneur Simon Halabi, and are being sold to repay investors part of the £1.15 billion in defaulted bonds which back the buildings.
One of the properties included in the sale is one of JP Morgan Chase’s London office buildings, priced at £466 million according to reports. The three buildings are being sold individually by CBRE, who manage the bonds. One of the other properties secured against the bonds is the headquarters of Aviva Plc, however this wont be put up for sale according to the statement released by CBRE.
Other buildings involved include Alban Gate, Leadenhall Court, New Court on Carey Street – all being marketed individually.Victoria Embankment, Sampson House, Ludgate House, Millennium Bridge House and the BSI tower are being marketed as a package called the ‘Thames Portfolio according to reports.
The office blocks are being sold at a time when there is a high demand for office space in London. However in the past two years there has been a 44% decrease in demand for commercial properties. Originally Halabi’s buildings were worth £1.83 billion packaged with bonds before the recession, but as the financial crisis continued their value dropped by around 50% and the bonds defaulted.
Proceeds from the sale should help to pay towards the losses from the bonds, mainly going to senior bondholders. However other bondholders are likely to lose part or even all of their investments.