Castleforge and Malaysia’s Gamuda Group have sealed a long-awaited £257m deal to buy Winchester House, EC2, and are now plotting a £1bn redevelopment of the office building.
The joint venture will redevelop the eight-storey, 320,000 sq ft building when current tenant Deutsche Bank moves to 21 Moorfields, EC2, a new office development expected to complete this year.
The new owners of Winchester House expect their own redevelopment to finish by 2027, taking the building to 500,000 sq ft of office space across 11 storeys. Discussions with potential occupiers are already said to be underway, and Gamuda said it will target “global or multinational financial institutions, legal firms and mega-tech corporations” as tenants.
China Investment Corporation and Invesco Real Estate marketed the building for £275m before Castleforge and Gamuda went under offer at a price of between £260m and £265m last August, chipping the price further in the following months. They will now pay £20m of the consideration on signing the sale and purchase agreement, with the rest funded through non-recourse debt and payable within 24 months of exchange.
Gamuda said the property was bought to hold in its Quick Turnaround Project portfolio, from which it looks to exit investments within five years of acquisition. The Malaysian developer holds 75% of the joint venture, with Castleforge holding the remainder.
Castleforge founding partner Michael Kovacs said: “This is a very exciting development not just for us but for potential future tenants looking to collaborate in the best office space available, right in the heart of London.”
Castleforge’s London portfolio also includes 1 Golden Lane, EC1, which was recently granted planning approval for refurbishment and extension.
Savills advised the buyers, while JLL and Eastdil advised the vendors.
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