A deal to quash a right-to-light issue with Radisson Edwardian by the owners of the Leicester Square Odeon has dampened offers for the prime development site.
The owners of the 0.47-acre LSQ site – Nama and Tamarin/Real Estate Solutions – have agreed to hand over more than 20,000 sq ft of space in the building to the neighbouring Radisson Edwardian hotel in exchange for the removal of their right-to-light claims.
The “sale” gives the private hotelier a block of around 77 bedrooms on a 999-year lease.
Bidders for the site, which selling agents CBRE and Knight Frank had hoped would fetch around £100m, said the move had devalued the site and made it “a lot less attractive”.
The block has consent for a 277,000 sq ft, hotel-led Make-designed scheme, however, sources said the Radisson deal would mean a new proposal would need to be submitted, leading to further costs and delays.
Indicative alternative residential-led plans, drawn up by architect 3DREID on behalf of the vendors, have already been dismissed by Westminster City council as something it would “not entertain”.
Exemplar Properties, which is acting for Hard Rock Hotels and was keen to make its debut on Leicester Square. However, it is now understood to be one of a number of potential bidders that have walked away.
Offers were called on 21 November and are understood to have come in at between £50m and £70m.
Among the bidders were Leicester Square landlords Criterion Capital and Soho Estates, London & Regional, Gracemark with a European fund manager, and hotel group Hilton Worldwide.
The site officially came to market in July, three months after Nama appointed Allsop receiver to the asset. It had been owned by Irish vehicle Steamboat, which bought the block in early 2006 for £28m, well above its £18.5m asking price, with debt from Anglo Irish Bank.
