Norwegian fund invests £570 million in London’s Covent Garden

Norwegian oil fund, Norges Bank Investment Management, has purchased a £570 million stake in Covent Garden, a famous area in London known for shopping and dining. This investment gives the fund a 25% interest in the property, previously owned by Shaftesbury Capital. The move is part of a larger strategy by the fund, which manages £1.5 trillion in assets from Norway’s oil and gas revenue. Recently, it invested £306 million in Grosvenor, acquiring part of a portfolio in Mayfair. In total, Norges has invested about £876 million in central London properties over the past two months. Jayesh Patel, head of UK real estate at Norges, expressed confidence in London's market, highlighting Covent Garden as a prime location with over 200 shops and nearly 200 restaurants and cafes. The area remains under the management of Shaftesbury, which also owns other London districts including Carnaby Street. The entire Covent Garden portfolio is worth £2.7 billion, with Shaftesbury’s total estate valued at £5 billion. After the announcement of the deal, shares in Shaftesbury rose by 5.6%. Analysts view this purchase as a positive sign for the London property market. Mike Prew from Jefferies noted that Norges' investments reflect confidence in the sector. Meanwhile, other analysts suggest that this rapid succession of deals shows Norges' belief in the value of London as a global city. Shaftesbury has seen a strong rebound in tourism since the pandemic, reporting its busiest Christmas season in 2024, attracting over a million visitors daily at peak times.