BNP Paribas in talks to buy UK estate agents Strutt & Parker

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BNP Paribas is in talks to acquire Strutt & Parker, the UK estate agents, in what would be a vote of confidence in the British property market by France’s biggest bank.

The talks have been going on for several months and may not lead to a deal, according to people familiar with the matter. BNP Paribas and Strutt & Parker both declined to comment.

Strutt & Parker, which made £18.2m of pre-tax profit on £108m of revenue in the year to April 2016, has been rumoured to be for sale for some time as it struggles with a sharp slowdown in prime London house prices.

BNP Paribas Real Estate is one of the biggest property services companies in Europe, generating more than €700m of revenues last year from consulting, managing and investing in both commercial and residential property. The UK is its third-biggest market after France and Germany, generating a 12 per cent of the unit’s total revenues.

The French bank, which has been one of the most acquisitive in Europe, may only be interested in buying the commercial property unit of Strutt & Parker and could team up with another group that buys the residential property arm.

Prices for prime London homes fell 5.8 per cent last year, and in the most expensive areas they are down 12.5 per cent from their 2014 peak, according to Savills. Among newly built central London homes, sales dropped in 2016 to their lowest since 2012, according to Molior London.

Strutt & Parker’s residential property arm specialises in high-end homes. This contributed to a 35 per cent fall in pre-tax profits in its last annual results. The estate agency has been considering its options, advised by Evercore, since last year.

Andy Martin, senior partner of the 132-year-old company, has announced plans to step down this year. Other potential suitors include CBRE and Bidwells, according to a recent report by Estates Gazette.

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