London, like most major urban areas across the globe, is experiencing a massive slowdown in the commercial property market. However, Great Portland Estates announced today that it is bucking the trend by selling Bond Street House, in London’s West End to an Institutional Luxemburg Société d’investissement à capital variable fund for around $67.5m. Such funds are increasingly popular in the EU and are similar to mutual funds in the US. The deals represents an initial yield of 5.8% and approximately 4% ahead of the 31 March 09 book value. The investment advisor is the Munich based iii-investments, the Real Estate Investment Company (KAG) of HypoVereinsbank. GPE also confirms Great Capital Partnership, its 50:50 joint venture with Liberty International subsidiary Capital & Counties has sold 29/35 Great Portland Street, W1 to a private buyer for $1.2m, an initial yield of 6.8% and in line with the March 2009 book value. Bond Street House is held on a lease from the Pollen Estate for a further 116 years at a fixed head rent of $0.75m per annum until September 2009 after which it increases to 25% of the net rents received. The office space above was refurbished by GPE in 2006 and let at rents of between $60 and $100 per sq. ft. The current net rent, having deducted headrent is nearly $4m per year. The Sicav will pay GPE initial consideration of $60m, and up to a maximum further $7.5m based on the April 2009 rent review settlement. GPE will retain control of the review and the full $7.5m will become payable provided the settlement is broadly in line with its external valuer’s 31 March 2009 rental value. The payment to GPE will be reduced on a straight line basis below this. Robert Noel, Property Director at GPE says: “These sales are in line with our disciplined approach to recycling capital from mature assets as we can put the money, in today’s opportune market, to better use elsewhere.”