A collection of holdings between Hanover Square and Oxford Street, W1, is being prepped to become the next major redevelopment opportunity on Britain’s most famous shopping street.
M&G Real Estate has earmarked its assets in the area for a redevelopment with a potential end value of up to £400m.
A range of investment options for the site are expected to be explored through CBRE this autumn, including a £150m sale of the freeholds, creating a joint venture agreement, or a property swap.
M&G has appointed architects to draw up an indicative redevelopment of the combined site, which is expected to comprise around 25,000 sq ft of prime retail space and 75,000 sq ft of offices and residential.
The site has attracted substantial unsolicited investor interest, but if no suitable offer is tabled, M&G is open to retaining the site for its own development.
M&G completed its assembly of the site in 2006, obtaining 14 Hanover Square and 293/295 Oxford Street as part of a property swap with Great Portland Estates.
Its combined holdings comprise 3-18 Harewood Place, 14-15 Hanover Square, and 293-297 Oxford Street, with frontage onto all three streets.
The retail elements, which all have lease events before March 2017, are considered ripe for reconfiguration into a flagship Oxford Street store, where zone-A rents have this year hit £1,010 per sq ft.
Current tenants in M&G’s 63,200 sq ft holdings – much of which is listed – include Time Retail Partners, Marc Fine Wines, John D Wood & Co and Harbottle & Lewis.
An M&G spokeswoman said: “We continuously appraise options for our assets, looking for opportunities to add value, grow income and maximise returns. All options are currently being considered.”
Hanover Square is at one of the focal points of West End development triggered by the forthcoming opening of Crossrail in 2018, with the eastern ticket hall providing an access point to Bond Street Station at the corner of Tenterden Street.
Great Portland Estates has a consented masterplan for a 200,000 sq ft over-station project which would overhaul the western side of the square, at numbers 18-19.
