September 29, 2009
HSBC is working on deals to sell three prized possessions, office assets on New York’s Fifth Avenue, Paris’ Champs Elysees, and London’s Canary Wharf. The assets are being marketed by CBRE as sale-leasebacks, and present the rare opportunity to acquire some of the world’s prized real estate, at a cost of course. The sale is expected to raise as much as $2.25 Billion for HSBC. This sale highlights a trend taking place where investors are shunning secondary and tertiary markets in anticipation of having the opportunity to acquire prime real estate in core markets. Not wanting to miss the opportunity, many investors are staying on the sidelines (though some are starting to venture in) waiting for “trophy” opportunities which is leading to additional pricing pressure on less-than-core sub-markets and ultimately causing the gap in yields to widen.
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