International consortium buys London's South Bank project for €422m

A four-member consortium from the UK, Malaysia and Singapore has exchanged contracts to acquire Sampson House and Ludgate House from asset manager The Carlyle Group's third European fund CEREPIII for £308 mln (€422 mln).

The consortium comprises UK developer Native Land, Singapore’s investment firm Temasek and listed hotel specialist Hotel Properties Limited (HPL), as well as Malaysia’s developer Amcorp Properties.

The transaction will result in the creation of the new £1 bn development of Bankside Quarter, a 1.4 million sq ft (130,000 m2) residential, office and retail development.

A planning consent for the redevelopment of the 5.3 acre site, designed by PLP Architecture, was secured by Carlyle in March 2014 and comprises permission for 489 apartments and 288,000 sq ft of offices, as well as retail, leisure and cultural facilities. When completed, the project will comprise five residential buildings and four office buildings rising from 13 to 49 storeys.

The planning consent also ensures a payment in lieu of affordable housing of £65 mln payable to Southwark Council.

Native Land is appointed as development manager to the consortium.

'The development of the Bankside Quarter will set the seal on London’s finest emerging location,' said Alasdair Nicholls, Chief Executive of Native Land.

Mark Harris, managing director at The Carlyle Group, added: 'Since acquiring these two properties in 2010 Carlyle has laid the foundations for the transformation of this important part of the South Bank area, creating a project which offers a once in a lifetime chance to regenerate a prime, central London site and create a new community while transforming one of London’s most popular riverbank locations.'

Ludgate House and Sampson House are the last two properties from the White Tower portfolio of six assets Carlyle acquired in July 2010 for a total of £671 mln. The portfolio included six landmark central London properties which were formerly part of the White Tower 2006-3 plc CMBS package.

Native Land intends to deliver the project in a series of phases, with the first phase including a 49-storey tower comprising 211 apartments fronting the River Thames. The subsequent phase will deliver a Grade A office building, with later phases including the redevelopment of Sampson House, which is currently leased to IBM until 2025 but with a mutual break option in June 2018.

London-based Native Land has already teamed up with HPL and Amcorp in the development of a major residential project at Campden Hill.

The partners plan to develop 72 private apartments and 97 units of mixed-tenure affordable housing on three sites across the Royal Borough of Kensington and Chelsea.

Temasek is believed to be part of the AXA Real Estate-led consortium which earlier this month acquired the former Pinnacle site in the City of London. The partners plan to develop a new building at the site, which is located at 22 Bishopsgate, London EC2 near Liverpool Street Station, with developer Lipton Rogers.

The new tower will provide over 1 million sq ft of prime offices, including retail as well as restaurant and bar space.