Metrovacesa brokers deal with L&G for Walbrook Square

Spanish property company Metrovacesa said it has reached an agreement with UK fund manager Legal & General that will allow the Madrid-based firm to advance the development of one of the largest City of London office schemes. In a statement to the Spanish securities regulator, Metrovacesa said late on Monday that the agreement with L&G is expected to end a legal dispute regarding the payment for London's Walbrook Square complex. The new agreement sets 31 October as the new payment date for the 88,000 m² office complex, which the Spanish firm bought in September for £240mln (EUR 350mln).

Last year the company said it was to invest up to EUR 1.4bn to 2015 to acquire and redevelop the office complex. The real estate giant plans to demolish the existing complex and replace it with a new office block by 2015. The new complex will include four buildings with retail space on the ground floor and direct access from London's underground network. The project has been designed by architects Foster and Nouvel and will be co-managed by British firm Stanhope. Metrovacesa will hold the rights for a 250-year lease hold on the property as part of the deal. The Spanish company added that the project would provide a return of 7% based on similar projects in London.