The Gherkin building located at 30 St. Mary Axe in London has reportedly been sold to the Safra Group for a deal worth more than $1 billion.
The Safra Group is an international cluster of companies run by Brazilian billionaire Joseph Safra and his family. The official price of the sale wasn't disclosed but people familiar with the matter said that the "pickle-shaped" building sold for about £726 million, which is almost a billion US dollars at today's exchange rates.
"The acquisition of 30 St Mary Axe is consistent with our real estate strategy of investing in properties that are truly special - at the best locations within great cities," The Safra Group said in a statement.
"While only 10 years old, this building is already a London icon that is distinguished from others in the market with excellent value growth potential. We intend to make the building even better and more desirable through active ownership that will lead to a range of enhancements that will benefit tenants," the group added.
Receivership
The Gherkin building was placed into receivership (bankruptcy protection) in April this year after owners VG Immobilien, a German real estate firm, defaulted on a loan they took out to purchase the Norman-Foster designed office building.
VG Immobilien agreed to pay $1 billion for the structure in 2007. However, as currency rates gained more than 63 percent since then, the German firm ran into debt and decided to seek financial protection. Deloitte was appointed the receiver of the building and by July, the financial firm put a $1.17 billion price tag on the building.
As London's commercial property market flourished, the building started drawing a lot of interest from international investors.
"Not only have we witnessed a sustained appetite from international investors for assets in London but we have seen a substantial improvement in business growth and take up of office supply as the Capital's economy continues to improve," Stephen Down, head of Central London Investment at Savills, was quoted by the Sydney Morning Herald when the Gherkin went up for sale.
The Gherkin Building
The Gherkin building is one of the defining skyscrapers of London's skyline. The building derives its moniker from its resemblance to a "pickle" but has also been a butt of jokes for its "phallus-like" structure.
Shooting up to 590 feet, the building is the third tallest tower in London. Its plaza measures the size of eight tennis courts and each of its 40 floors rotates five degrees at the end with the last curved piece ending at the building's top. The structure uses 50 percent less energy that an average UK building and its design won the Royal Institute of British Architects' Stirling Prize in 2004, when it opened.
