Canary Wharf Group acquires full ownership of Wood Wharf Partnership
Canary Wharf Group has acquired ownership of the Wood Wharf Limited Partnership and associated companies and an overriding 250 year lease for the 16.8 acre Wood Wharf site immediately adjacent to the Canary Wharf business and shopping district. The transaction reflects Canary Wharf Group's commitment to developing a more diverse portfolio, both in terms of its asset and tenant base, and its confidence about the future of London as a pre-eminent global centre.
Canary Wharf Group has acquired 100 per cent of the Wood Wharf Limited Partnership by combining its own 25 per cent interest with the 75 per cent interests acquired from its original joint venture partners British Waterways and Ballymore Properties Limited ("Ballymore"). It also agreed the restructuring of British Waterway's on-going participation as freeholder of the Wood Wharf site. As a result, Canary Wharf Group has control over the timing and design of the scheme.
Wood Wharf will be a new mixed use development scheme adjacent to the Canary Wharf estate. In May 2009 the current master plan, designed by Rogers, Stirk, Harbour and Partners with Landscape architects Martha Schwartz and Partners, received one of London's largest ever single outline planning consent for 4.8m sq ft net. This represents an area almost one third of the size of the Canary Wharf Estate and will comprise approximately 1.25m sq ft of residential development, 0.2m sq ft of retail, 3.1m sq ft of offices and a 0.2m sq ft hotel. Detailed consent was granted on the three office buildings closest to the Canary Wharf estate totalling 1.5m sq ft net in July 2009.
The consideration paid for the acquisition of British Waterways' 50 per cent interest in Wood Wharf is £52.4 million together with a restructured 250 year lease that will see an annual ground rental payment to British Waterways increase to £6 million by 2016. For the remainder of the lease this payment will be subject to upwards-only review linked to the passing rent achieved on the office buildings and the ground rents paid by purchasers of the residential apartments built on the scheme. The £52.4m payment comprises an upfront payment of £4.4 million and a series of four annual payments up to and including 2015. The total consideration paid for the acquisition of Ballymore's 25 per cent effective interest in Wood Wharf is £38m. These transactions are fully funded by Canary Wharf Group's cash resources.
Sir George Iacobescu, Chairman and Chief Executive of Canary Wharf Group, said: "Wood Wharf's development will mark an important evolution in the development of the Canary Wharf business, retail and residential district. This mixed use development will set new, world-class standards for design, sustainability and community integration. The acquisition terms are attractive for land with planning consent adjacent to Canary Wharf which will benefit from Canary Wharf's considerable existing infrastructure and be complemented by Crossrail from 2018."
To date, Canary Wharf Group has designed and constructed over 15 m sq ft of office space at Canary Wharf. Following these transactions, in addition to the Wood Wharf site, Canary Wharf Group has a development pipeline at Canary Wharf with planning permission for 5.29m sq ft (excluding the Riverside South project owned by J.P. Morgan for which Canary Wharf Group is Development and Construction Manager).