Madison International Realty now owns a piece of the celebrated Salesforce Tower in London. The New York-based real estate private equity firm recently acquired a minority stake in the 441,000-square-foot asset via a Jersey Property Unit Trust, becoming partners with the premier property’s developer, Heron International, and other investors.
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Madison is not disclosing the financial terms of the transaction or the percentage of the interest it acquired in Salesforce Tower, which Heron developed in 2011 as Heron Tower. However, London’s The Times reported just a few months ago in February that Saudi Prince Abdul Aziz bin Fahd, possessing a 25 percent interest in the 46-story office high-rise, was in talks to sell his ownership stake Madison.
Madison felt a magnetic pull to Salesforce Tower. “Madison invests in high quality properties in prime cities in the U.S., U.K. and Europe. We continue to see great potential in London. Salesforce Tower is a trophy asset in a busy and flourishing area of the city,” Alex Lukesch, managing director with Madison International Realty, told Commercial Property Executive.
Standing 755 feet high at 110 Bishopsgate, Salesforce Tower holds the distinction of being one of the tallest buildings in London’s financial district and is well known as home to Britain’s largest privately owned aquarium as well as a sizeable solar panel installation that graces one of the structure’s façades and generates energy for the property. The Kohn Pedersen Fox Associates-designed building, which also features retail offerings on the ground level and four upper floors, is presently 93 percent leased to a diverse list of businesses, including lead tenant Salesforce.
Like Madison, the lending community recently acted on its high regard for Salesforce Tower. In March 2021, ING and Landesbank Baden-Württembergled served as lead arrangers with a consortium of banks that provided Salesforce Tower’s ownership with a five-year loan to the tune of £400 million, or approximately $564.1 million, for the refinancing of the asset.
Madison refused to sit on the sidelines during the pandemic; instead, the firm remained active across the board. Its transactions during the height of the global health crisis included the investment of $100 million in life sciences REIT IQHQ, which completed a $1.7 billion equity raise in November, and the establishment of a $150 million equity joint venture with Plymouth Industrial for the acquisition of value-add and opportunistic industrial assets in target U.S. markets. Additionally, Madison acquired an interest in the newly developed Chmielna 89, an approximately 270,000-square-foot, fully leased Warsaw office property that is valued at more than €100 million, or roughly $121 million.
Looking ahead, it will be business as usual for Madison. Lukesch added, “We are continuing to assess investments in key sectors including industrial, life sciences and residential in our areas of geographic focus.”