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Reports of Brexit doom and snap elections are attracting more Asian buyers to UK real estate, with Hong Kong billionaire Joseph Lau’s Chinese Estates becoming the latest to scoop up discounted assets in London.

Lau’s Hong Kong-listed development company has purchased 11-12 St James’s Square, a listed commercial building in London’s West End from the Employees’ Provident Wealth Fund of Malaysia for ₤174.9 million ($227 million) according to a recent announcement by Chinese Estates to the Hong Kong stock exchange.

And despite a recent rise in the British currency performance against the US dollar, the pound’s decline in the last year means that Chinese Estates is buying a property which once commanded the world’s highest office rent at a discount of more than five percent over what the Malaysian fund paid for the 81,500 square foot (7,572 square metre) building in 2011, in US dollar terms.

Malaysian Fund Sells into Brexit Headwinds

Malaysia’s EPF had put the elite office asset on sale earlier this year, along with another London property, with news reports indicating that the fund hoped to bring in as much as £205 million from the St James disposal.

Ultimately, while the sale price of ₤174.9 million was more in local currency terms than the fund’s reported August 2011 purchase price of ₤147.5 million, in US dollar terms, the price declined by more than $13 million.

Chinese Estates Expands London Portfolio

The St James Place acquisition is the latest London deal for Chinese Estates, which bought up two other commercial buildings in the city during recent years.

Once serving as the head office of British property firm MEPC, the St James Square building once achieved the world’s highest office rental rates, when it leased two floors to a hedge fund for £140 per square foot in 2007.

In its announcement to the stock exchange, Chinese Estates said that this latest acquisition “is in line with the principal business of the Group in relation to property leasing,” and added that it intends to hold the asset as an investment property “for long term capital growth and rental purpose.”

The London acquisition comes 14 months after Chinese Estates agreed to buy 14 St George Street in London from Aberdeen Asset Management for £122 million. The Hong Kong firm also owns Goldman Sachs’ London offices at River Court, 120 Fleet Street, which they bought in 2011 for around £300 million.

Asian Investors See Opportunity Amid Brexit Worries

Chinese Estates is able to build up its London portfolio at a discount in part due to the impact that Brexit concerns are having on the city’s finance industry. Authorities in Frankfurt reported recently that some of the US’ biggest banks, including JP Morgan, Morgan Stanley, Goldman Sachs, Bank of America and Citigroup plan to move more than 1,000 job into the German city by the end of Brexit talks.

Despite the plans of these US banks, Asian investors remain confident in the UK, and have helped to drive real estate transaction volumes to their highest level since 2015, in local currency terms.

London became Europe’s most heavily traded real estate market in the first quarter this year, according to recent research by JLL. “With the sterling depreciation and slight drop in capital values, Asian investors – particularly private buyers from Hong Kong and China – have been the most active in London since last year’s Brexit vote,” says David Green-Morgan, Head of Research, Global Capital Markets at JLL. “The depreciation and capital values drop means that UK commercial real estate is now discounted by 16 per cent on average to overseas capital since the June 2016 referendum.

Chinese Estates and its Hong Kong cohort are among the most active of these Asian players, spending nearly $3 billion exclusively on UK properties during the first three months of this year, compared to only $842 million during the same period of 2016.