The sale of a £270m City of London office building to a Malaysian investment fund has collapsed.

PNB, the fund that invests on behalf of the indigenous Bumiputera population of Malaysia, was set to buy the 340,000 sq ft building in a deal that would have represented a 5.7% yield.

As revealed by propertyweek.com (24.2.12) the building was put into receivership to try and facilitate a sale. The £275m of debt secured against the building matured last October.

The building was bought by clients of Irish investment manager D2 Private for £325m in 2006.

Knight Frank and Jones Lang LaSalle are advising on the sale, and Capita is advising investors who bought bonds secured against the loan. Capita said it is examining the best strategy for seeing the debt repaid.