Norwegian Sovereign Wealth Fund has $740 million in London’s Covent Garden

Norway’s $1.8 trillion sovereign wealth fund (the world’s largest variety) said on Thursday it signed an agreement to buy a one-in-a-century real estate portfolio at London’s iconic Covent Garden in its latest bet on premium real estate in the UK capital.

In the new joint venture, Fund’s manager Norges Bank Investment Management (NBIM), said it will pay £570 million ($739 million) for a 25% stake in UK property developer Shaftesbury Capital’s London real estate portfolio.

NBIM said the portfolio consists of 1.5 million square feet of properties, mainly used for retail and leisure purposes, within Covent Garden’s London district and seven dials.

London-listed Shaftesbury Capital stock jumped nearly 16% in the market opening before making a slight profit. Stock had risen 8.9% by 9:55am in London.

“This investment highlights our belief in London’s strength by complementing other high-quality West End investments by the portfolio,” said Jaish Patel, head of UK real estate at NBIM in a statement.

This follows a £306 million investment by the Norwegian National Asset Fund, a 25% investment in the Duke of Westminster real estate in January.

The joint venture, which again granted NBIM a 25% stake, was worth £1.2 billion, marking the biggest sale to outside investors in Grosvenor’s historic Mayfair Estate.

The two deals have brought Sovereign Wealth Fund’s total investment in London to £876 million this year.

NBIM also said Thursday it agreed to pay 240 million euros for a 40% stake in AXA Lifestyle Housing, the owner and operator of Spanish and French student housing and co-living.