Hammerson plc has entered into a joint venture with two leading investors to carry out the development of 125 Old Broad Street, London EC2. GE Real Estate and Bank of Ireland (Private Banking) will each acquire a 25% stake in the 125 OBS Ltd. Partnership for £37.5 million. Hammerson will continue to own 50% of the partnership, and will be retained as the development and asset manager of the scheme. Hammerson will use the proceeds to finance its UK development programme.
Hammerson acquired the site of the former London Stock Exchange in June 2004 for approximately £68 million. The site had planning consent for two major office schemes, 125 Old Broad Street and 60 Threadneedle Street.
The redevelopment of the 26-story tower building at 125 Old Broad Street will provide 30,100 m² of Grade A office accommodation and 600 m² of retail space. Construction started in February this year with completion scheduled for December 2007. At 30 June 2006, Hammerson's 100% interest in 125 Old Broad Street was valued at £116 million.
Hammerson retains ownership of the adjacent site, 60 Threadneedle Street, which has planning consent for a 20,600 m² nine story office scheme.
John Richards, Chief Executive of Hammerson, said: "Hammerson is delighted to be working with GE and Bank of Ireland Private Banking to deliver this landmark scheme. This sale demonstrates the significant value Hammerson has added to the former Stock Exchange site since it was acquired in 2004. We have seen a considerable increase in demand for office space in the City this year and we anticipate that rental values will continue to improve during 2007."