London Development in Focus

We know that the London commercial development market is struggling in the current economic climate.  The perception of scarcity in significant development opportunity, particularly for office & mixed use, has skewed the marketplace.  Difficult for most, but for those funds that are holding big cash reserves opportunity knocks.

Sovereign wealth funds, private equity firms and UK REITs are lining up to pick off those opportunities that come along, in readiness for a hoped for upturn in demand once completed.  The opportunities to acquire significant development sites are, however, scarce. Battersea Power Station was hanging around derelict and in abeyance for years, before becoming the subject of a tussle between half a dozen companies, all after the rights to spend billions redeveloping the landmark site.  The Malaysian consortium led by SP Setia & Sime Darby will commence the £8 billion scheme next year.

The Qatari state has invested over £20 billion in London in recent years, confirming the confidence they have professed in the London market.  Of note is Qatar’s 95% ownership of the Shard, London’s newest, tallest and brightest tower.  Amongst future schemes Qatar will participate in the redevelopment of  most of the Royal Dutch Shell Plc complex near Waterloo station in a venture with Canary Wharf Group.  The Qatari Prime Minister Sheikh Hamad Bin Jasim Bin Jabr al-Thani has said that “There are a lot of things in the pipeline”

Further developments will come on stream over time, including Brookfield’s purchase of Hammerson’s London buildings and 100 Bishopsgate, an office tower planned near Liverpool Street station which it owns half of and the develop an office building on London Wall Place.

The development game in London is limited to those with large equity reserves, sovereign wealth positions or very strong balance sheets who can take on corporate debt.

Watch this space…..

New Development agreed in City

A 500,000ft2 office development in the City has taken a significant step closer to reality with the granting of consent to the scheme by the City of London Planning and Transport Committee.  Hammerson’s 121 & 123 London Wall Place development will require the demolition of St Alphage House and will be built out in two towers, rising to 16 stories and will incorporate landscaped roof gardens, as well as extensive open spaces around London Wall and St Alphage's Church Tower , which remains.

Further bridges will be added to the Barbican’s famous highwalk system, which is retained, allowing easy access to all parts of the City

The scheme will prove a tricky project to undertake as the site is relatively constricted and is situated in the heart of the Barbican, which is well populated with local residents, many of whom are high profile.

It is expected the site will be built for completion in 2014 with full occupation to be achieved in 2015.

http://www.hammerson.com/