Group leads field in bid to clinch 200,000 sq ft City of London site
It is thought the FTSE 100 group is to be recommended as the preferred developer to City corporation members next month, ahead of two other shortlisted companies, Exemplar Properties and Terrace Hill.
The City-owned site is bounded by Brushfield Street, Commercial Street, White’s Row and Crispin Street. It could accommodate a 200,000 sq ft office and retail-led scheme, but will require a fairly complex development arrangement.
If British Land is formally appointed by the City it will pay between £2m and £5m for the option to the site and then have to secure planning permission.
Once planning permission has been obtained, it will pay an unspecified amount to the City and will be granted a long lease for the site. It must then finance the development.
There is also a clause specifying that the City must be given a share in the development profit.
The site has had a complicated history. It is owned by the City of London but is within the Tower Hamlets borough and therefore needs planning consent from the latter. It is also in a very sensitive historical area given its proximity to the Nicholas Hawksmoor-designed Christ Church.
One planning application has already been refused. In 2005, Tower Hamlets rejected a Foggo Associates-designed scheme, called New Exchange, to redevelop the site, which would have almost doubled the size of the existing 135,000 sq ft building.
There is also some way to go on securing vacant possession of the site, which is across the road from Allen & Overy’s 750,000 sq ft headquarters. A Barclays bank and a pub still also occupy part of the site.
The City has said it will secure vacant possession of the pub but, as part of any deal, British Land will need to secure vacant possession of Barclays.
If a development agreement goes ahead it will be a significant commitment to the City of London by British Land, which is also developing its Ropemaker office scheme next to Citypoint and has committed to its ‘cheesegrater’ skyscraper on Leadenhall Street.
CB Richard Ellis advised the City. All parties declined to comment.