Regalian’s London landmark, Marble Arch Tower, is finally under offer after more than six months on the market. Industry sources say that Greycoat Estates has emerged as the front-runner to buy the flagship property on Oxford Street, London W1.
It is thought to have offered Regalian, which paid £18m for the building and invested millions of pounds on refurbishing it, close to its £70m asking price. Merrill Lynch Asset Management, major shareholder in Greycoat, would make the cash available for the investment.
Greycoat director David Ainsworth would not confirm the transaction, but said: “It is one of a number of buildings we have looked at.”
When the building came to the market in April, Jones Lang LaSalle (JLL), handling the sale, set a deadline to receive bids at the end of May 2000. JLL had hoped to complete a deal by July but it is thought that several bids were received for the 10,219 sq m (110,000 sq ft) building and that the sale has been held up as Regalian considered its preferred bidder.
Julian Stocks, head of West End investment at JLL, confirmed Regalian was finally dealing with one bidder but would not reveal its identity.
He said: “We do have the building under offer but I will not be drawn on confirming or denying any names. There will now be a 28-day consultation period leading up to a final deal.”
In 1998 Greycoat bought the 29,730 sq m (320,000 sq ft) Tower 42, EC2, with Hermes and Mercury Asset Management.
A source close to the company said: “It has a track record of being keen on these types of active management, short-lease opportunities. Greycoat sees this as a great opportunity, and Regalian wants to return the proceeds from the sale to shareholders.”
After selling its Paddington Goods Yard site to Development Securities earlier in the year, this is the last hurdle remaining for Regalian before it returns to its role as an upmarket residential developer.
Meanwhile, Canadian conglomerate Seagram plans to move out of its head quarters at the Ark in Hammersmith, West London.
The move follows its proposed £19bn merger with French company Vivendi and the newly formed Vivendi Universal will start a London-wide search for a new HQ.
Seagram occupies the 13,666 sq m (141,000 sq ft) Ark site on two 25-year leases with break options at the end of 2010.
Agents believe the company agreed a rent of £248 per sq m (£23 per sq ft) for the building in 1996, which is expected to soar to more than £376.74 per sq m (£35 per sq ft) if re-let. Jones Lang LaSalle (JLL) is advising Seagram.
EGi News 29/09/00
