HSBC received a record 180 inquiries to buy its Canary Wharf headquarters, but it was the record £1.09 billion offer from Metrovacesa, of Spain, that mattered for London’s office property market.

The offer, the largest ever in the UK for a single property asset, reflects a London commercial property market that is running at full tilt, with possibly years more of huge deals still to come.

HSBC told The Times that it was considering similar sale and leaseback deals for its offices in Sheffield and Birmingham, home to about 8,000 staff, to exploit the demand for British office property. A sale and leaseback on HSBC’s Park Street offices in Southwark, covering 100,000 sq ft, is also on the cards, according to Richard Spence, head of the bank’s special operations.

Prices in London are now eclipsing those in New York in a sign that investors are betting that the capital is set to overtake Manhattan as the principal driver for economic growth in international capital markets, according to a report from Cushman & Wakefield.

Metrovacesa, Spain’s largest quoted real estate company, which is controlled by the Sanahuja family, will lease the HSBC building back for £43.5 million on a 20-year term with a five-year extension option. That is the equivalent of a yield worth just 3.8 per cent, less than the Bank of England’s base lending rate.

Barely six months ago Swiss Re sold its 30 St Mary Axe building, known as the Gherkin, for £615 million to IVG Immobilien, of Germany, and the Mayfair-based Evans Randall. That deal represented a yield of 4.5 per cent, meaning that top quality so-called trophy assets have gained about 10 per cent in capital value since the start of the year.

Mr Spence, who led the auction of the Canary Wharf headquarters, said: “We did not expect it to go high. As we went out with the invitation to bid, we had about 180 entries, resulting in a dozen serious bids.” Investors have been paying record prices for London offices in the expectation that rent rises will pick up pace in years to come.

Tony McCurley, of CB Richard Ellis, which handled the HSBC sale, said: “The breadth and depth of interest in this investment shows the liquidity in the market and the extent of the capital available for investment in London.”

Metrovacesa, which is about to be split into separate units holding its French and Spanish assets, is planning to buy more office space in Paris and London. The demerger will leave Cresa Patrimonial, a company controlled by the Sanahuja family, with about 80 per cent of Metrovacesa’s shares.

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