HSBC Private Bank has bought a second $200m
property in Washington DC for a syndicate of its private banking
clients, a sign that interest in the hard-hit commercial real
estate sector is increasing.
HSBC Alternative Investments Limited and the
group of HSBC private banking clients paid $209.2 million for the
corner site overlooking Franklin Square Park in the centre of the
US capital.
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The office space is 100% leased to tenants
such as Johnson & Johnson, Ford, and Food Products Association
and other businesses under long term lease covenants.
HSBC said a large amount of the current rents
were below estimated market rent offering the opportunity to
substantially increase income from the building.
This latest acquisition follows a similar
$200m acquisition of another prime Washington property at the end
of 2009.
The bank is reportedly looking at forming
similar groups of investors for other projects, including in US
cities and London. Coutts is also rumoured to be forming similar
syndicates.
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By GlobalDataThe deal was supported by HSBC Alternative
Investments, an area the bank is increasingly focusing on as a key
differentiator for its private banking business.
Alternative investments, including real
estate, have been central to HSBC’s strategy in private banking. It
is one of the world’s largest investors in hedge funds, with around
$30bn invested.
