Irish Investors Buying Lloyds of London HQ for £240 Million

Property Week - December 12, 2003

A syndicate of Irish investors is set for one of the biggest investment deals of the year by buying the landmark Lloyds of London headquarters. The Richard Rogers-designed building on Leadenhall Street, EC3, is being sold by German open-ended fund Deka and has been placed under offer by the consortium at close to the asking price of £240m.

The deal will be one of the biggest purchases by an Irish syndicate, the members of which are unknown. It is close in value to the £246.5m deal to buy Goldman Sachs' Fleet Street HQ by a consortium led by Dublin accountant Kevin Warren and Green Property in 2000. Irish investors are hugely active in the UK property market. In a report issued this week, Irish agent Lisney said a record ¤2bn (£1.4bn) was expected to be invested overseas by Irish investors this year, and 90% of that is being spent in the UK.

The Lloyds building, which totals 310,000 sq ft (28,800 sq m) and was completed in 1986, is one of the best-known examples of modern architecture in the country. There had been speculation that Lloyds was trying to buy back the building, having sold it to Deka in 1996. However, it would have been difficult for the institution to be seen to be buying it back. It only sold the building to Deka, at that time known as Despa, for £180m, in a sale-and-leaseback deal under which Lloyds took a 30-year lease.

Any deal now would require Lloyds to pay at least £50m more to buy it back. 'We're not involved in any plans to buy the building,' said a Lloyds spokesman this week. The bid to sell is unusual for Deka which, along with the other German open-ended funds, has been an active acquirer of well-let UK office buildings. In recent months it has bought two buildings from Prudential in the City for a total of more than £300m.

FPDSavills and CB Richard Ellis are advising it on the sale.

Sphere: Related Content