H&M owner buys Regent Street block

The Swedish billionaire owner of H&M has snapped up a prime slice of London's Regent Street in a £225m deal.

Stefan Persson is believed to have struck an agreement late last week to buy the office and shopping block, whose tenants include Banana Republic, H&M and Armani Exchange.The sale comes amid bumper demand for commercial property, which has surged in value since the end of the credit crunch.

The deal will generate huge profits for Delancey, the private property company run by Jamie Ritblat, which bought and redeveloped the site in 2006. Property sources said the purchase price was so high the deal would generate an initial investment return of only 4.75% for Persson. Delancey is thought to have more than doubled its money.