Owners pull London’s Tower 42 sale, cite fund inflow

* Tower 42 pulled from sale due to fund inflow

* Owners say sees development, leasing opportunities

* AREF says Q2 property funds net inflow boost NAV

LONDON, Aug 23 (BestGrowthStock) – The owners of Tower 42 Estate
have taken the London City landmark off the market citing on
Monday an inflow of funds that now allows them to improve the
site and try to bring in stronger tenants.

Joint owners BlackRock (BLK.N: ), Hermes Real Estate and
LaSalle Investment Management (JLL.N: ) in April put the estate —
a 600-foot skyscraper and five smaller buildings — up for sale
for 300 million pounds ($468 million). [ID:nLEE6FD000]

“This new direction in strategy, also a result of an inflow
of funds, enables the Partnership to progress … significant
development potential and leasing opportunities (at the estate),
at a time when rents in the City market are clearly on an upward
trend,” a spokesman for the owners said.

JPMorgan property analysts said in client note that the
withdrawal of the Tower 42 sale “comes at a time when buyers
have become more disciplined on pricing”.

“While many property agents forecast (London) prime rents to
rise … if anything, we believe there is a higher chance of
surprise to the downside for these bullish expectations than to
the upside,” the JPMorgan note said.

Data this month showed wider UK commercial property value
growth slowed to 0.2 percent in July, while rents continued to
slump, a sign the market’s year-long rebound has lost steam as
concerns rise over the health of the economy. [ID:nLDE67C1GY]

In a separate statement, the Association of Real Estate
Funds (AREF) said UK unlisted pooled property funds posted net
inflows of 900 million pounds in the second quarter, up from 100
million in the same period in 2009.

The rise in new money raised helped boost performance at its
66 member funds over the three months, lifting their net asset
value to 30.5 billion pounds at end-June 2010, up from 21
billion a year ago, the AREF report said.
(Reporting by Daryl Loo; Editing by Andrew Macdonald)
($1=.6413 Pound)
(See www.reutersrealestate.com for the global service for real
estate professionals from Reuters)

Owners pull London’s Tower 42 sale, cite fund inflow