Secret Syndicates Buying Commercial Property

Private banks are putting together secret syndicates of their rich clients to buy commercial property off-market.

HSBC Private Bank said that there had been a rise in demand from its international clients for exposure to big-ticket commercial property investments in capital cities, after evidence that the market had bottomed out.The bank said that it had taken the “unusual step” of setting up a syndicate in response, a move that will add to an already competitive field of investors seeking to capitalise on what they see as an historically attractive opportunity.

HSBC, which has reported a doubling in demand for property investments in the past 18 months, last week completed the £141.7 million purchase of an office and restaurant building in Washington on behalf of 17 anonymous investors.

The bank said that it planned to set up similar syndicates to meet demand for property in New York, Boston and London. The buyers remain anonymous, even to each other, investing for three to five years, generating income from rent and hoping to sell the property for a higher sum than its original purchase price.

Timesonline