The world’s largest sovereign wealth fund—Norway’s Norges Bank Investment Management (NBIM)—is buying a 25% stake in London’s buzzy Covent Garden worth £570 million ($739 million).
NBIM, which has nearly $2 trillion worth of assets under management and holds 1.5% of all listed companies in the world, is partnering with Shaftesbury Capital, the area’s landlord, for the deal.
The Covent Garden estate is now worth £2.7 billion ($3.5 billion), Shaftesbury said in a press release Thursday. Retail and food and beverage establishments use most of the land, while office and residential buildings occupy a quarter.
The area, which includes Seven Dials and Neal’s Yard, is already a popular tourist destination and boasts stores of most major brands, from Tissot and Ladurée to Apple and Chanel.
NBIM’s investment comes amid a slew of new retail establishments opening up in Covent Garden, including brands like perfumery Diptyque, activewear brand Alo Yoga, and cosmetics store Charlotte Tilbury.
Covent Garden is one of London’s prominent cultural hubs. When the city was decimated by fire in 1666, the area rose to the occasion, becoming London’s largest market selling fruit and vegetables.
Today, it’s home to the city’s West End and Opera shows and flaunts a Piazza with scores of food and retail joints sprinkled around.
The area suffered from the loss of foot traffic during the COVID-19 pandemic, losing about a quarter of its value at the time from £2.5 billion to £1.8 billion. As activity began picking up, Shaftesbury continued to bolster its portfolio in Covent Garden’s prime property market. Luxury property demand in Covent Garden reached “record-breaking” levels last year, real estate firm UK Sotheby’s International Realty found.
“This investment underscores our belief in the strength of London with the portfolio complementing our other high quality West End investments,” said Jayesh Patel, head of UK real estate at NBIM. “Covent Garden is one of the world’s most recognized retail, leisure and cultural destinations.”
The vibrant shopping district isn’t the only one that has recently grabbed NBIM’s attention. In January, the Norwegian fund bought a quarter of the Grosvenor property portfolio in London’s upscale Mayfair neighborhood. The deal was worth £307.5 million and includes a mix of office and retail buildings.
NBIM also owns a portion of Regent Street through a partnership with the Crown Estate.
Companies are trying to take advantage of low prices in prime real estate, including high-end retail, following the whiplash from high interest rates.
NBIM, led by CEO Nicolai Tangen, has become an avid investor over the years. Most of its funds are invested in equity, including roughly $173 billion in Magnificent Seven stocks. Only 7% of its investments are in real estate.
Following the deal’s announcement, Shaftesbury’s shares were up 7.5% at 11.30 a.m. London time.
Representatives at NBIM and Shaftesbury didn’t immediately return Fortune’s requests for comment.
