JOHANNESBURG - Natie Kirsh, the London-based SA billionaire, today confirmed that his £285m bid for one of London’s tallest buildings, Tower 42, has been successful.
Speaking to Moneyweb, Kirsh said: “It’s in the documentation phase, which means all the papers still have to be signed but we have secured it. The owners received 12 offers and whittled it down to three. They interviewed me to make sure I could finance the deal. They were nervous, having been let down in the past but after the interview they confirmed we were the guys.”
Kirsh is one of SA’s richest men. His biggest asset is Jetro, a successful cash and carry chain in the US styled after Metro Cash of SA. He is the sole owner. He said he will not be selling a single share in Jetro to fund the deal but its cash flow would make it easy to pay.
Asked if such a large investment in a single property was not risky at the present juncture of the UK and world economy, he said: “No. It is a fantastic building in the heart of the City. It is fully let with 300 tenants and a waiting list of corporates wanting to get it. It was built by a bank, not by a property developer. The bank was building its own head office and wasn’t fussy about lettable space. Every part of the building has huge window space. It is built in the shape of a 3-leaf clover. Each floor is 3 000 square feet.”
According to Wikipedia, Tower 42, originally named Natwest Tower, was for 30 years London’s highest building. Now it ranks fifth and second in the city. The 42-storey building is 183m (600 feet) high. It has an automated mail train and external window washing. The building was extensively damaged in the IRA’s Bishopsgate bombing.
Kirsh says even at the £285m price tag, the rental yield starts off at 7%. He intends to gear his purchase and thus to get the yield to 11%.
“With everyone printing money, inflation is not going away. If you factor in inflation, the yield could quickly exceed 20%.”
Kirsh owns a city block in Rivonia Rd, a stone’s throw from Sandton City. Did he not consider building a skyscraper there, as has been speculated?
“You tell me where SA is going. Can the government make a foreign investor comfortable?
“Right now, I feel disinclined at my age (79) to start a major development. As they say, a shroud doesn’t have pockets. I have one idea for the site, which is not commercial – a sort of museum to reflect the contribution to the SA economy made by immigrants over the years.
“I would like to ask other rich South Africans, the Ruperts, the Oppenheimers to help develop this, possibly in association with the university (Wits is Kirsh’s alma mater).
“It would be a living thing with lecture halls and so on. I am coming down there soon for a couple of months and will see how they respond.”