Norway colonizes central London

LondonThe next time you are strolling through Covent Garden in central London and stop to see a performance of a stand-up comedian or try one jacket potato to kill the appetite, Think of the butterfly paradox. Yes, the one that says that the flapping of a butterfly's wings—for example, the mountain lion—anywhere in China can cause a storm on the other side of the world. In this case, however, the hurricane in Texas—or in London—is caused by the terrifying noise of drones flying overhead. fly over and explode over Ukraine, not that of any butterfly.

That conflict is big business for certain industrial sectors is evidence that has been confirmed daily for more than three years. Like all wars. Aside from the obvious arms companies, which profit and will continue to profit, and even more so thanks to the European rearmament plan, one of the big beneficiaries of Vladimir Putin's expansionist ambitions has been Norges Bank Investment Management (NBIM), the Norwegian sovereign wealth fund, which reports to the country's central bank. One of the NBIM's functions is to invest oil and gas revenues in stocks, bonds, and real estate around the world.

As Russian hydrocarbon exports to Europe fell, Norway became one of the continent's largest suppliers. In 2022 and 2023, the Nordic country earned nearly $111 billion in additional revenue from gas exports, according to estimates. published at the end of last year by the Ministry of Finance. The rise in energy prices caused by sanctions on the Russian economy also contributed, of course.

A fir tree in Trafalgar Square

Largely thanks to the extra profits from oil and gas, and consolidating a years-long trend, last week NBIM acquired a 25% stake in the former Covent Garden fruit market, now one of the city's major tourist centers.

The investment cost €680 million, which went to swell the coffers of Shaftesbury Capital, the owner of Covent Garden's property portfolio, which includes 220 buildings with more than 220 retail businesses, more than 190 bars, and more than 190 pubs. But it's all more or less staying in-house. Because NBIM already owned 25% of Shaftesbury Capital.

In January 2025, the Norwegians also acquired a €365 million stake in the properties of Mayfair – one of the most exclusive neighborhoods in the British capital – in the Grosvenor Estate company, the property arm of the Duke of Westminster, Hugh Grosvenor, of the Hugh Grosvenor family from the second half of the 17th century. The Grosvenors began the development of Mayfair in 1720 and now control some 175 buildings in the area, with an approximate value of around €1.6 billion.

The interest and ties between Norway and London go back a long way. King Haakon VII found refuge there during the Nazi occupation of his country. As a result, every year at Christmas, Norway sends a fir tree from its forests as a token of gratitude to the British people. They place it in the center of Trafalgar Square, like a kind of flag marking its ownership and also who owns the surrounding land. In a way, that's right. Back in 2014, the NBIM bought most of what was called the Pollen Estate, another set of properties, this time to the east of the central and exclusive Mayfair neighborhood, which includes, among others, the famous Savile Row, the street par excellence of some of the best classic men's tailors in the world.

In addition to the recent purchase of a quarter of Covent Garden, the Norwegian fund already owned other areas of the West End (the most touristy part of the British capital), including a 25% stake in Regent Street, the main shopping street. And as owners of a quarter of the shares in the company Shafesbury Capital, the Norwegians also own parts of Carnaby Street, Soho, and Chinatown, all areas very close to Covent Garden. Norges Bank also controls the Meadowhall shopping center in the city of Sheffield, in northern England.

Norway's expansion in London has not gone unnoticed by some of the country's critics, who believe that while it has benefited greatly from the collateral damage of Putin's war, it has not contributed, proportionally, as much as it could have and as other European countries have done to aid Kiev. In principle, Norway has allocated just over €2.86 billion to support Ukraine in its 2025 budget. If you add what it contributed in 2024, its support represents less than 5% of its two-year war profits. By comparison, Germany, Europe's largest contributor, has provided €15 billion in military, financial, and humanitarian support to Ukraine from January 2022 to the end of October 2024. Norway's support to Ukraine as a proportion of its GDP is 0.7%, far behind Denmark.

Kiev is not London, of course. And Covent Garden is more than just property titles that have been changing hands for 250 years. Fortunately, the name still evokes some imaginary: that of Franzy, by Alfred Hitchcock;the one of Pygmalion either My Fair Lady, by Bernard Shaw and George Cuckor, or the improvised stage of the stand-up comedians that are still seen.