Tishman Speyer secures £130m BNP Paribas development loan for Eland House in London’s Victoria

Tishman Speyer has closed a £130m five-year development loan for the circa £300m redevelopment of Eland House in London’s Victoria from BNP Paribas Corporate and Investment Banking.

BNP CandI logoLand Securities sold the building to Tishman in 2012 for £171.1m, reflecting a net initial yield of 7.14%.

Tishman lodged Aukett Fitzoy Robinson-designed plans last year following an agreement with the DCLG that saw it surrender its lease on the property as it moves 1,200 civil servants to 2 Marsham Street in Victoria.

In April of this year planning for a major refurbishment was approved that will see the building increase from 257,797 sq ft to 317,083 sq ft.

This would create an additional 21,000 sq ft of offices as well as the introduction of a 28,470 sq ft supermarket on the ground floor and 5,381 sq ft for a smaller shop and two flexible retail or café or office units.

Work has commenced and the property will be ready for occupation in spring 2016. BNP Paribas acted as sole arranger on the financing.

This is the third facility that BNP Paribas has provided for Tishman Speyer in 2014, equating to a total of over £300m.

In July, BNP Paribas Corporate and Investment Banking closed another development facility for an office building near Paris.  Shortly after, BNP Paribas provided a £115.5m, seven-year financing for Tishman Speyer’s purchase of a 236,000 sq ft prime office building in Paddington.

Romain Simon, Head of UK real estate finance at BNP Paribas said in a statement: “BNP Paribas is focused on building long term client relationships, understanding their strategies and being able to support these clients both on their core investments and on their value-add projects.

“Tishman Speyer is an excellent example of a quality sponsor whom we have been able to support across Europe, and we are delighted to be a part of this extremely exciting project.”

The most contentious element was Tishman’s desire to address the council’s mixed-use policy by offsetting the increase in commercial floorspace with a supermarket and other small retail uses.

The plans include remodelling and extensions at roof levels, the formation of terraces, relocation of plant, alterations to existing ground floor entrances, the formation of new ground floor entrances and recladding.

The existing building was constructed in 1995 and comprises ground, basement and 10 upper floors.

jwallace@costar.co.uk

About CoStar News

Finance Editor, CoStar News
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