A joint venture between Canadian investor Cadillac Fairview, the real estate arm of Ontario Teachers’ Pension Plan and UK developer Stanhope, has finalised an agreement to buy 70 Gracechurch Street, a prime office building situated in the City of London. The property offers a rare combination of attractive day one yield running into a significant 600,000 sqft development opportunity.
The site is currently occupied by a 10-storey building leased by Marks & Spencer and AXA-owned insurer XL Catlin with existing planning consent for a 34-storey tower offering. The investment is the latest venture for the two companies that announced a fortnight ago they are teaming up with Thomas White Oxford to deliver a £700 million innovation district at Oxford North.
Stanhope are also working with Cadillac Fairview at White City Place, the expanding creative and life sciences hub which Cadillac Fairview acquired in 2020.
Commenting on the purchase, Jenny Hammarlund, managing director, Head of Europe, Cadillac Fairview said: “Following our recent agreement to develop Oxford North as well as recent investments in the logistics and the residential sectors in the UK, our acquisition of 70 Gracechurch Street further demonstrates our commitment to grow our investment portfolio in the UK. We see continuing opportunities for high quality, differentiated office, particularly in London, and this is a long-term investment in the future success of the City of London.”
David Camp, Chief Executive of Stanhope added: “This is a unique asset being a prime Freehold in the heart of the City with well secured income and a planning consent in place for a new city tower. Reflecting the rapidly evolving needs of occupiers and the imperative that we must be continually pushing the boundary of carbon neutrality and broad ESG and EDI principles we will undertake a thorough, research based, review of the design to ensure that the building is robust in meeting the needs of occupiers into the 2030s and beyond.”
CBRE acted for Stanhope and Cadillac Fairview, Savills acted for the Vendor.