GRAND BUILDING
A new start for a
ONE OF TRAFALGAR SQUARE’S MOST IMPOSING BUILDINGS IS GETTING A NEW LEASE OF LIFE. WE SPOKE TO ROB RACKIND OF WAINBRIDGE ABOUT HOW GRAND BUILDINGS HAS BECOME ONE STRAND.
Pink marble and koi carp were to 1990s office development what padded shoulders, big watches and scrunchies were to the fashion scene of the time. Signs that you were ‘in the groove’.
In 1990, when Land Securities launched its Grand Buildings office development on Trafalgar Square it was at the forefront of the London office market. The building’s reception area glistened with pink marble and its atrium was home to carp and palm trees. Even in a cooling market, it wasn’t too long for most of the space to be snapped up by Enterprise Oil – the former employer of the current Archbishop of Canterbury.
As Justin Welby can testify, a lot has happened in the intervening years and time had not been all that kind to the Grand Buildings when a wealthy overseas investor bought the property in 2010 for £173m.
Shortly afterwards, specialist asset and development manager Wainbridge was appointed to mastermind the phased makeover of the then 201,500 sq ft office building. The refurbishment has delivered and astonishing transformation of the building.
There is not a tile of pink marble or a koi carp in sight, and the building has a new name – One Strand.
Reflecting on what has been achieved, Rob Rackind, principal and co-founder of Wainbridge, comments:
“When we took the project on, the property needed a complete modernisation. We met with the owner and explained to him; ‘You have a jewel but the building’s mechanical and electrical systems are over 20 years old and the building needs reconfiguring to meet today’s occupier needs.
“If you don’t invest capital on refitting the floors to Cat A standards and replace and improve the cooling and heating systems you will never get the rent that the building truly deserves.
“We brought together a professional team including the original architects – Sidell Gibson – and demonstrated to the owner that by speculatively investing in the refurbishment you could create disproportionate value. When refurbishing a property it is essential to determine the optimal level of investment to maximise the value of the property. For a private investor one also has to consider the cashflow impact of the project as that cashflow is often used at a personal level for personal needs.
“It was essential to prove to the owner that the cash flow would be enhanced over the medium term business plan because the investment philosophy of a private owner is very different to that of an institution. Institutional owners often put more emphasis on equivalent/reversionary yields rather than “cash on cash” returns and cashflow.
“Those managing institutional investment groups are more often than not employees and don’t need the money to fund their family office investment strategy. These guys go to bed at night having been paid monthly regardless of the building income or performance. That’s not how private investors think. They focus as much on getting income as they do on maximising asset value and often income is more important.
“So a vital part of the business strategy for this project was creating a business plan that worked throughout for the owner by maximising value whilst retaining cashflow”.
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