Oil giant BP Amoco is poised to buy the former Ericsson head office at 1 St Jamess Square, SW1, for its own occupation.
It has emerged that BP, one of the worlds biggest companies, is putting the finishing touches to a £110m deal to buy the 98,500 sq m (106,000 sq ft) building. One insider said it plans to move “strategic facilities” into the HQ over the next few months.
BP plans to keep its 18,580 sq m (200,000 sq ft) Britannic House HQ in Finsbury Circus, EC2. But when the deal is finalised, the chairmans office and board members are all expected to move to St Jamess.
The source said: “Speculation had been mounting that the building was under offer to an owner-occupier, but this has been the best-kept secret since the sale of Berkeley Square.
“It is something that all parties concerned have been sworn to secrecy on because nobody, particularly Ericcson, wants the deal to collapse. Nobody thought BPs name would come out.”
In June, BPs pension fund raised £315m by selling a collection of buildings in and around Berkeley Square, W1. However, the acquisition of 1 St Jamess Square is being funded by BP Amocos operating company through BP Investments.
The deal has come as welcome news for cash-strapped Ericsson, which will relocate all its staff now at 1 St Jamess Square, to Herons 105 Wigmore Street, W1, scheme. Ericsson took a prelet on the Wigmore Street space in August at a record rent for the area.
The Swedish telco had planned to occupy less than half of the St Jamess HQ, but last month instructed Healey & Baker to find either a tenant for the whole building or a party prepared to buy the freehold.
Healey & Baker, BP and Ericsson all refused to comment.
However, another source close to the deal said: “The move reflects the changing fortunes of the respective sectors. Throughout negotiations you could sense Ericssons envy of BPs riches and plans to expand.”
EGi News 06/10/01
