Talks between the German fund, Deka, and the Irish property company, Shelbourne Developments, over the sale of the famous Lloyd’s Building in the City of London have collapsed.
It is understood that Deka wanted to complete the deal last Tuesday, but withdrew contract papers citing “commercial points”. However, a spokesperson for Shelbourne said that there were “no financial difficulties” with the offer, which is backed by Goldman Sachs.
However, cracks had been discovered in the building, and Shelbourne and Deka had both commissioned Arup to carry out an investigation into the structure. Shelbourne said it terminated the transaction after a survey revealed alkali silica reaction, known as ‘concrete cancer’, in some samples.
Shelbourne said in an emailed statement that it “felt that as an investment the building was less attractive and the company was not comfortable to proceed any further.”
Deka is now understood to be in negotiations with a number of underbidders over the 375,000 sq ft building, which was put up for sale last year with a £240m price tag.
CB Richard Ellis and FPDSavills are advising Deka.
Source: Freeman News