CIC-owned company to expand Canary Wharf with mixed-use development
The Canary Wharf Group has bought out its two joint-venture partners in a development deal that will see the City’s second site expand into residential and high street retail according to IP Real Estate.
The group, whose parent company has the Chinese and Qatari sovereign wealth funds as major shareholders, has increased its stake from 25% to 100% in the sole development project of the Wood Wharf Limited Partnership, the three-way joint venture set up in 2009 to develop a 17-acre site next to Canary Wharf.
The mixed-use development will include residential and retail, as well as office.
The Canary Wharf Group did not respond to requests for interview today.
However, in a statement, it said the deal reflected its confidence in the future of the financial district and would give it control over the timing and design of the scheme – suggesting the scheme had been held up by one or both of the other partners since planning permission for the derelict site was granted in 2009.
According to the group, the expansion reflects its commitment to developing a diverse portfolio in terms of both assets and tenants.
British Waterways, which owned 50% of the joint venture, sold its share for £52.4m (€63.2m) over four years – equivalent to the amount it has invested in the development since it acquired the site in 2005 – in a deal that will provide the infrastructure body with annual ground rent of £6m for 250 years.
Property director Stuart Mills last week slated as “nonsense” criticism that the deal was, in his words, “not as wonderful as it looks”. In an open letter issued by the body, he pointed out that the deal closed with a Canary Wharf Group included an upward-only ground rent clause.
According to Mills, the £85m-90m uplift on the original £20m site acquisition cost made it “a pretty good deal” and “certainly way ahead of the equivalent inflation on our original investment”.
The Canary Wharf Group acquired Ballymore’s 25% interest in the wharf development for £38m.