Norway Wealth Fund Buys £570 Million Stake in Covent Garden (1)

The world’s largest sovereign wealth fund isn’t waiting around to snap up a discount as the real estate correction unleashed by higher interest rates hoists “for sale” signs over some of London’s most sought-after properties.

Norges Bank Investment Management entered into a partnership with landlord Shaftesbury Capital Plc to buy a 25% stake in a £2.7 billion ($3.5 billion) portfolio of prime property around London’s Covent Garden district, according to a statement on Thursday. The transaction, set to conclude in April, will hand £570 million in cash to Shaftesbury.

The Norwegian fund’s second-major acquisition in the city this year highlights ...