Singapore-listed real estate company City Developments has completed the acquisition of the landmark St Katharine Docks located in Central London, UK from funds advised by Blackstone for £395 million (S$636 million) or £751 psf (S$1,209 psf) on the existing net lettable area.
Opened in 1828, the 23-acre freehold mixed-use estate fronting the River Thames comprises over 500,000 square feet (sq ft) of Grade A office, F&B, retail and residential arranged across four main buildings and supporting ancillary spaces, including a marina with berths for up to 185 yachts.
Located in the heart of London near the financial district, St Katharine Docks enjoys excellent connectivity to transport networks. Providing a tranquil yet vibrant respite from the bustle of the city, the unique riverside estate offers scenic views overlooking the Tower of London, a UNESCO World Heritage site, and the iconic Tower Bridge.
St Katharine Docks attracts over 5.9 million visitors annually. Since 2011, the estate underwent a £69.5 million repositioning and refurbishment programme, which included enhancements to the buildings, the marina and the overall estate.
The office component, housed in four main buildings, currently enjoys a strong occupancy rate of 90% with a well-diversified tenant base across sectors such as consulting, shipping, education and co-working spaces, which accounts for around 92% of the estate’s income. Long-term income has been secured, with an overall Weighted Average Unexpired Lease Term (WAULT) of 8.2 years (to lease breaks) and 9.4 years (to lease expiries). In addition, CDL has identified strong potential for positive rental reversion and asset management opportunities to add value.
Sherman Kwek, CDL Group Chief Executive Officer, said, “The current uncertainty in the UK has provided us with strategic opportunities to acquire prime assets and expand our portfolio. This latest acquisition of the sizeable St Katharine Docks freehold estate, one of London’s trophy landmarks, increases CDL’s total commercial assets in the UK to around £1 billion and enhances our recurring income stream. It complements our fund management strategy, providing us with the option to inject our UK assets into listed or unlisted platforms at an opportune time. In addition, there are ample asset management opportunities for us to demonstrate our ability to enhance value and improve operational efficiency.”
The acquisition of St Katharine Docks is funded through CDL’s internal cash resources and credit facilities.
CDL’s other commercial properties in the UK include two prime freehold Grade A buildings in Central London, acquired in 2018 – Aldgate House and 125 Old Broad Street. Both enjoy stable rent collections and strong committed occupancies of 98.1% and 92.4% respectively.