The Home Office headquarters in Whitehall, SW1, is to be transformed into central London’s first luxury retirement home.
Retirement property specialist Pegasus Homes, backed by Oaktree Capital Management, has bought the 39,000 sq ft government-let Grenadier House to convert into a £60m scheme, Estates Gazette can reveal.
Plans will be worked up for as many as 50 luxury retirement flats offering owners on-site health assistance if needed.
Current values for the space would be about £1,500 per sq ft, but this is expected to rise by the time the government leaves the building. It has a lease expiry in 2015, after 10 years at the Victoria property.
Pegasus paid just over £25m – a 6.89% yield – for 99-105 Horseferry Road, which CBRE was formally instructed to sell in March by a private company affiliated with the Saudi Arabian Jameel family.
Bruno Jaczkowski, residential development director at Jones Lang LaSalle, which advised Pegasus, said: “I am not aware of anything of this sort in zone one. This is the vanguard of senior living.”
Alastair Perks, central London development director at CBRE, said: “Pegasus’ proposals for the property demonstrate an exciting new concept in the residential market and one that we expect to be very successful.”
The demand for retirement buildings is being fuelled by longer life expectancy, with the number of 85-year-olds in the UK expected to increase by 250% by 2036, according to research firm Laing & Buisson.
Tom Morgan, senior director in CBRE’s healthcare team, said: “This scheme will provide something that is largely missing in the central London market. Such high-quality schemes are normally found in rural areas.”
Morgan added that CBRE is advising three parties on purchasing, or securing planning for, similar developments in central London.
Pegasus was unavailable for comment.
joanna.bourke@estatesgazette.com
