This Week's London Deal Sheet
The Deal Sheet is a weekly compilation of Greater London and beyond's biggest leases, sales, financing deals, construction updates and personnel moves. Have news you’d like to submit? Email mark.faithfull@bisnow.com.
Investment and development company Sellar has secured a resolution to grant planning permission for the development of 444 purpose-built student homes, fully direct let, with eight affordable homes for local key workers and flexible office and retail space.
Permission followed a unanimous decision from Southwark Council on 18 July, and King’s Place will offer more than double the average internal and external amenity space per room found in PBSA across London, according to Sellar.
King’s Place will also include 20K SF of flexible work and retail space, including a corner café on Borough High Street and a new pocket park that will be created on Harper Road.
King’s Place will be an all-electric building, and Sellar is aiming for BREEAM Excellent as a minimum target for the development, which it said is on track to be BREEAM Outstanding.
Morris+Company is the architect, DP9 acted as planning consultant and Savills advised on funding for the scheme.
DEVELOPMENT
Canary Wharf Group and Kadans Science Partner have secured planning approval from Tower Hamlets Council for the development of a commercial health and life sciences building at the North Quay site at Canary Wharf, London.
The 23-storey, 823K SF tower will create a vertical campus, which will be Europe’s largest and most technologically advanced life sciences facility, the companies said.
Enabling works on the 8.2-acre site are underway, and the building, designed by Kohn Pedersen Fox Associates, is anticipated to complete in 2027. A low-carbon strategy has been implemented across the development, including highly insulated and airtight building fabric, an optimised facade, energy-efficient mechanical, electrical and plumbing systems, and the provision of renewable energy sources and photo voltaic panels.
CWG and Kadans have accelerated the growth of the existing health and life sciences community across Canary Wharf, including the recent completion of a 40K SF wet lab innovation and flexible workspace centre at 20 Water Street, plus an innovation centre at 20 Water Street.
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The final building in the King’s Cross masterplan has been granted approval by the London Borough of Camden and will be the 50th building delivered as part of the King’s Cross estate.
Building F1 will occupy an island plot adjacent to the Regent’s Canal and is the last plot to be developed under the original outline permissions. The plans for the seven-storey building consist of more than 54K SF of commercial space, as well as flexible retail units and improved public realm. It has been designed by Lee Wilkinson Architecture.
Over 17 years, 8M SF of development and 30 acres of public realm have been approved, according to the developer.
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Great Portland Estates and The Crown Estate have exchanged an option which, if exercised by GPE, will provide a new head lease and development agreement to facilitate the redevelopment of French Railways House and 50 Jermyn Street, SW1.
The redevelopment forms part of The Crown Estate’s strategy to regenerate the wider area, attracting new brands, businesses and visitors.
GPE’s interests at French Railways House and 50 Jermyn Street are held on leases expiring in 2053 and 2057 at a combined fixed rent of £13,250 per year. The new head lease across both buildings would be for a term of 129 years and geared to 10% of rents received.
GPE secured planning consent for an office-led redevelopment at French Railways House and 50 Jermyn Street, SW1, in May 2022. Make Architects has been appointed to help deliver 67K SF of Grade A offices over the first to seventh floors and two retail/restaurant units on the ground floor.
“Sustainability is at the core of our redevelopment strategy and we are aiming to set a precedent for London by re-using over 1K tonnes of structural steel, creating premium spaces into a market that is increasingly starved of such exceptional properties,” GPE Executive Director Dan Nicholson said in a statement.
FUNDS
Hines has raised an additional £265M of equity from institutional investors for the Hines European Value Fund 3.
The fund has raised over £1.26B since its launch in mid-2022, with an initial target of £1.3B of equity. Final closing of HEVF 3 is planned to take place in November, with the fund’s investment period running until mid-2026. Hines raised over £1.6B of commitments for the first and second HEVF in 2018 and 2020.
HEVF 3 has attracted commitments from 30 limited partners, including institutional investors, alongside a Hines co-investment.
The fund has completed its third investment and has a further four in exclusivity. If all are acquired, these investments would bring HEVF 3 to around 25% allocated.
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Greater Manchester Pension Fund and South Yorkshire Pensions Authority have joined the London Borough of Newham as the latest local government pension schemes committing to Cheyne Capital’s impact real estate strategy.
Cheyne Impact Real Estate specialises in building housing for general needs and specialist purposes. Within its projects, a significant proportion of the homes are made available to lower-income and key worker residents at significant discounts.
Cheyne Impact Real Estate’s development in Manchester’s New Cross district will open its doors to residents later in July. The scheme contains 35% of homes reserved for local key workers at rents calculated to account for no more than 30% of tenants’ net disposable income. Another two schemes are due to complete this year.
LEASING
Blackstone has taken Cargo, an office development in Canary Wharf principally leased to BP, to full occupancy with the addition of Euronext.
Blackstone bought 25 North Colonnade in 2014 from Evans Randall Holdings and Lone Star Bank for £163M, reflecting a net initial yield of 8%.
In 2018, Blackstone carried out a £100M refurbishment programme of the 390K SF building that included 20K SF of terraces. It has leased to 100% occupancy and a 12-year weighted average unexpired lease term.
The ground-level floors are leased to Market Halls, a food court operator.
FOR SALE
Aerium, the European real estate fund manager, has appointed Knight Frank and JLL to sell Herbal House at 8-10 Back Hill, EC1.
The company is seeking £140M, and the multilet freehold building has a weighted average unexpired lease term of 5.3 years. Aerium completed a £66M refinancing with Deutsche Bank in 2017 for the redevelopment of the Clerkenwell site.
The former warehouse was redesigned as a 115K SF building comprising over 100K SF of offices and is let to four office occupiers, including Adidas and Moonpig.
