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BlackRock to sell Shanghai office towers acquired for US$167 million in 2018 for 30 per cent discount, sources say
- The New York-based asset manager is marketing the property in northwestern Shanghai at a reduced rate to speed up the sale
- Prime offices in Beijing and Shanghai traded at capitalisation rates of about 5 per cent last quarter, the highest in more than a decade, Colliers data shows
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BlackRock is seeking to sell an office complex in Shanghai at about a 30 per cent discount to its purchase price, people with knowledge of the matter said, reflecting the sluggish commercial property market in China’s biggest city.
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The New York-based asset manager is marketing the property in northwestern Shanghai at a reduced rate to speed up the sale, according to the people, who asked not to be identified because the information is private.
A representative for BlackRock declined to comment.
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BlackRock bought two towers at Waterfront Place from PGIM Real Estate for a reported 1.2 billion yuan (US$167 million) in 2018. They have a total area of 27,805 square metres (299,290 sq ft) of office space in Chang Feng, a decentralised business district.
Finding a buyer in China’s current commercial property market may be difficult, with other institutional investors offloading offices as the weak economy and oversupply weigh on the sector. Falling rents and a global trend to reduce exposure to office assets make such properties less appealing to potential investors.
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