Nine Elms on London’s South Bank offers everything a foreign embassy could need: security, location and floorspace – as well as the chance for profit by selling property in the pricier postcodes, says David Thame
D
The proposed development at Nine Elms, new home of the Dutch and US embassies
8 June 2013
riven by the prospect of more efficient and secure office space – and by the chance to make a handsome profit by selling old embassy buildings – London’s diplomats are heading south of the river. The imminent arrival of
the Dutch and US embassies, and the prospect that the Chinese and United Arab Emirates will follow, could transform the mighty Nine Elms regeneration area into London’s new diplomatic quarter. The South Bank accounts for a tiny 4,400 sq ft of London’s 1.9m sq ft of diplomatic office floorspace, according to Colliers International. But that could change. The combined Dutch and US embassies will amount to 670,000 sq ft; the UAE could add another 30,000 sq ft and the Chinese up to 100,000 sq ft.
EMBASSY STATS
UNITED STATES Current embassy 24 Grosvenor Square, W1 Size 225,000 sq ft Status Leasehold Other London floorspace 5 Upper Grosvenor Street, W1, and 55-56 Upper Brook Street, W1 The plan Security was behind the hard decision to move to 622,000 sq ft at Ballymore’s 2.6m sq ft Embassy Gardens. The absence of major Underground lines – a security risk – was important. Zoe Bignell at Cushman & Wakefield says: “They also liked the idea of being a catalyst for regeneration, and the proximity to Whitehall and Westminster.”
Nine Elms seems an unlikely
diplomatic roost – discrete, upscale restaurants, hushed apartment buildings and luxury retail are all in short supply. But insiders say that Nine Elms’ cheap land, just a short limousine ride from Whitehall and Westminster, has given foreign governments a taste for property development.
Zoe Bignell is partner at Cushman
& Wakefield and adviser to both the US State Department and the Netherlands Foreign Ministry. She explains: “Lots of embassies want a premises move to be not just self-financing but profitable.” Canadian and Greek governments
have already shown the potential. Faced with the financial crisis back home, the Greek government sold its 10,000 sq ft embassy at 1A Holland Park for a cool £23m. The Canadians, meanwhile, are planning the sale of their 130,000 sq ft home at Macdonald House, Grosvenor Square. They hope to sell for £150m, opening the door to a £400m-plus residential conversion. Foreign governments with prime London freeholds have every reason to consider moving to a cheaper location. Bignell says: “Embassies on long lease or with freeholds will, I’m certain, be reviewing their properties and assessing whether they need to be in some of the highest value office space in central London, particularly now that more of the capital is connected and accessible.” Having decided to sell up in Belgravia,
Knightsbridge or Mayfair, foreign embassies need to find a new site that meets their security needs and their aspirations for an impressive statement building. The floorspace also needs to be cheaper and more efficient than staying put. And if there are other embassies in the neighbourhood (the diplomatic corps has historically preferred to stick together), so much the better. According to Simon Taylor, associate at
GL Hearn, which is advising on half of the land in the Nine Elms regeneration area, Nine Elms was almost bound to appeal. Taylor says: “Nine Elms always had the potential for diplomatic use because
www.estatesgazette.com 37
Page 1 |
Page 2 |
Page 3 |
Page 4 |
Page 5 |
Page 6 |
Page 7 |
Page 8 |
Page 9 |
Page 10 |
Page 11 |
Page 12 |
Page 13 |
Page 14 |
Page 15 |
Page 16 |
Page 17 |
Page 18 |
Page 19 |
Page 20 |
Page 21 |
Page 22 |
Page 23 |
Page 24 |
Page 25 |
Page 26 |
Page 27 |
Page 28 |
Page 29 |
Page 30 |
Page 31 |
Page 32 |
Page 33 |
Page 34 |
Page 35 |
Page 36 |
Page 37 |
Page 38 |
Page 39 |
Page 40 |
Page 41 |
Page 42 |
Page 43 |
Page 44 |
Page 45 |
Page 46 |
Page 47 |
Page 48 |
Page 49 |
Page 50