This Chinese Developer Has Committed To Build £4.5B In London In Less Than A Year
London’s residential development market is slowing, but one developer is clearly not worried.
Yesterday it emerged that Dalian Wanda has sold its One Nine Elms residential and hotel development to fellow Chinese firm R&F.
R&F has now bought four major London residential-led development schemes in less than a year, which will have a total cost of more than £4.5B, and deliver almost 4,000 new homes. Three are in Nine Elms, the area where fears of oversupply are combining with construction cost increases to hit the returns expected by developers.
R&F is listed in Hong Kong and has a market capitalisation of around £6B. And it now has a development pipeline equivalent to about 10% of the approximately 40,000 new homes expected to be built in London this year.
Here are the schemes it has bought.
In March R&F bought the 5.5-acre Queen’s Square development site in Croydon from Delancey and Ares Management. The site includes the Nestlé Tower, which has planning permission for conversion to 288 apartments, and Segas House, where permission will be sought for up to 800 units. The price was not disclosed but R&F said the scheme would cost around £500M to build.
In April R&F paid CLS £158M for the Vauxhall Square development site, now renamed Nine Elms Square. The 1.5M SF site has planning permission for 578 flats across two towers, and the company said it will cost about £1B to build.
In August R&F bought the 10-acre New Covent Garden Market site, also in Nine Elms, alongside fellow Hong Kong-listed company CC Land. Dalian Wanda flipped the scheme after paying owners St. Modwen and Vinci £470M for the site but deciding not to push on with building it. The site will see around 1,800 new homes built at a development cost of around £2B.
On 16 January, Dalian Wanda sold its second Nine Elms site to R&F in a more conventional deal. R&F paid £59M and took on £159M of debt secured against the One Nine Elms scheme, which comprises two towers including 437 apartments and a five-star hotel. The cost of the scheme could be up to £1B.
