Chinese property giant joins consortium behind €1b London project

Vanke, China’s largest property company, is entering the European property market by joining the consortium behind the €1 bn Stage mixed-use development in London’s Shoreditch district.

Vanke is taking a 21% holding in the project, which is backed by a consortium of US private investor Cain Hoy Enterprises and its partners MG Properties, Galliard Homes and Investec Structured Property Finance.

Known as The Stage, the project covers a 0.93-hectare site including the remains of Shakespeare’s 16th-century Curtain Theatre, where Romeo and Juliet was first performed.

Plans include a 40-storey residential tower and more than 23,225 m2 of office, retail and leisure accommodation. The remains of the theatre will be excavated and preserved as a tourist attraction.

MG Properties, the real estate investment and development arm of McCourt Global, are also in the consortium, which will develop the site in partnership with Plough Yard Developments Ltd.

Plough Yard gained planning permission in 2013 to build the residential tower, but the project stalled while it searched for a funding partner. The developer will retain the freehold interest on the site and grant a new 250-year lease to the consortium.

'The Stage combines an internationally important heritage site with a high quality residential, office and retail scheme in an exceptional central London location. We are pleased to welcome Vanke to the project, who, as China’s largest property company, bring with them not only a significant financial investment but also additional expertise, and international knowledge and contacts,' said Jonathan Goldstein, Chief Executive of Cain Hoy.

Lily Lin, UK Managing Director at Vanke, said: 'We are very pleased to be joining Cain Hoy and this high-calibre group of joint venture partners through our investment in The Stage. Located in a very exciting part of London, this is a unique, multi-faceted and high-quality development of cultural and historic importance, which is a fitting debut for Vanke in the UK market.'

GM Real Estate acted for the Cain Hoy-led venture; Vanke was unrepresented.

Shenzhen-headquartered Vanke employs over 35,000 people across 65 offices in China, as well as international offices in Hong Kong, New York and London. The firm has a market cap of HK$150 bn (£12.4 bn) and is China’s largest real estate developer by sales – which amounted to RMB 215 bn (£22 bn last year.

Chinese capital
Capital flows by Chinese investors and developers into the UK continue to rise despite the country's economic slowdown. Last month, China's Xinjiang Hualing Industry & Trade Group said it was backing three real estate projects in the north of England with a total end value of £1.2 bn (€1.6 bn).

The Chinese conglomerate is committing £60 mln to kick start projects in Leeds, Salford and Sheffield, which are being led by Kevin McCabe's Scarborough Group.

In August, Chinese conglomerate HNA acquired the Thomson Reuters London headquarters in Canary Wharf from German fund manager KanAm. Financial details were not disclosed. However, UK press reported earlier this year that the asset had been put on the market for a price of £215 mln (€295 mln), or a yield of 5.5%.