Shard owners bag London's Park House

Barwa Real Estate has sold its interest in the Park House office scheme on London's Oxford Street to the Qatari owners of London's Shard tower less than a year after buying the building for £250 mln (EUR 286 mln).

UK REIT Land Securities, which sold the complex to Barwa Real Estate last June, will change its initial agreement with Barwa Real Estate to facilitate the sale of the building to a subsidiary of Shard Funding Ltd, which is the parent company of the London Bridge Quarter development and is advised and represented by QNB Capital, Qatar's national leading financial institution.

Land Securities agreed to convert the future deferred consideration and contingent profit share announced when Park House was sold to Barwa Real Estate into a fixed payment of £71 mln. Under the original agreement Land Securities was due to receive a payment of £25 mln on practical completion in November 2012 and a further profit share up to a maximum of £50 mln a year later. The fixed payment will now be made on the earlier of practical completion or 28 February 2013.

Land Securities will remain as development manager of the project.

'We are making great progress at Park House and remain committed to working with QNB Capital in producing a world class building,' said Robert Noel, managing director of Land Securities' London Portfolio. 'Today's transaction converts a contingent future payment into an earlier fixed payment eliminating risk as we recycle capital back into our development programme, including our latest schemes at 123 Victoria Street, SW1 and 110 Cannon Street, EC4, both of which are due to be completed before Park House.'

A consortium of QInvest, Sellar Property Group, Qatar National Bank, Qatari Islamic Bank and Barwa committed in 2008 to buy an 80% stake in the Shard tower development in London. The 72-storey Shard, designed by Renzo Piano, will be the tallest building in the UK when completed.