UK pension fund USS has agreed to forward fund London’s 40 Eastbourne Terrace in a £143 mln (€167 mln) deal with landlord Invesco Real Estate and development manager YardNine.

invesco

Invesco

Invesco Real Estate and YardNine signed a pre-let with hotel group Whitbread in January 2021 for a new 369-bedroom hotel and restaurant as part of a major mixed-use development on a 35-year index linked lease at 40 Eastbourne Terrace next to Paddington Station.
 
The hotel will comprise a 275-bedroom Premier Inn, a 94-bedroom hub by Premier Inn and Whitbread’s premium Bar + Block Steakhouse restaurant – the first time all three brands will occupy the same building.  
 
Invesco Real Estate acquired both 40 and 50 Eastbourne Terrace on behalf of one of its US separate account clients in July 2018. The redevelopment of the two sites, in conjunction with YardNine, will provide 75,000 sq ft (6,970 m2) of Grade A office accommodation, with 10,000 sq ft of retail space and seven mews houses – all due for completion by the end of 2021. Work on a 369-bed hotel is already underway and is due for completion in 2023.
 
 Mark Younger, Director of YardNine said: ‘The progress we have made at 40 and 50 Eastbourne Terrace since acquisition – physically separating the buildings, securing vacant possession, achieving planning consent for both the hotel and an additional floor on 50 Eastbourne Terrace, pre-letting the hotel to an outstanding hotel operator and securing funding for 40 in just three and a half years – is a testament to the hard work of all involved, particularly during a global pandemic. We are now just weeks away from completing Fifty Paddington, our office development at 50 Eastbourne Terrace, and look forward to seeing our ambitious plans for 40 Eastbourne Terrace starting to take shape.’
 
Richard Chambers, senior director – fund management, Europe at Invesco Real Estate, said: ‘We are delighted to be able to realise the efforts of the work and commitment by our teams over the past three-and-a-half years on this exciting project.’

RX London and Ashursts acted for Invesco Real Estate and JLL and DLA Piper acted for USS.