Having sold its headquarters building in London's Canary Wharf to Metrovacesa for £1.1 bn (EUR 1.6 bn) early this summer, HSBC bank is still burdened with an £800 mln (EUR 1.2 bn) short-term loan that it made to the Spanish property company to enable them to complete the deal. HSBC had hoped to refinance its loan by selling it on to other banks, which would also have reduced its financial risk to the building.
Having sold its headquarters building in London's Canary Wharf to Metrovacesa for £1.1 bn (EUR 1.6 bn) early this summer, HSBC bank is still burdened with an £800 mln (EUR 1.2 bn) short-term loan that it made to the Spanish property company to enable them to complete the deal. HSBC had hoped to refinance its loan by selling it on to other banks, which would also have reduced its financial risk to the building.
The international credit crisis hitting property deals is now making this approach difficult, so both HSBC and Metrovacesa are looking for an alternative solution. The deal was reportedly the biggest in UK property history, and involved Metrovacesa agreeing to lease the building back the HSBC for an annual rent of £43.5 mln (EUR 64 mln) on a 20-year term, with an option to extend for a further five years.
