Getting a toehold in the global real estate business, Mumbai-based Lodha Developer hasbought the Canadian high commission's building in central London for over Rs 3,120 crore (306 million). This 0.67-acre property will be converted into super-luxury residences for the ultra rich."Lodha clearly has the scale to go overseas and develop a property in a mature market, which will help Lodha to create an international brand," Sanjay Dutt of Cushman and Wakefield told CNBC-TV18.
Here is all you need to know about the deal:
1. This is Lodha's first deal outside India and the company is expected to turn the Grosvenor Square property into luxury condominiums. The construction, however, will not start till next year as London planning authorities have not changed the use from commercial to residential, Times of India reported, quoting consultants close to the Lodha Group.
The 150,000 square feet MacDonald House is headquarters of the Canadian High Commission in Mayfair area and it is near the Grosvenor Square which is one of the prime properties is London. It has been home to more than a dozen Canadian High Commissioners to Britain over the past 50 years, including Paul Martin Sr, Fredrik Eaton and Roy McMurtry. Canada had bought the building from the US government in the 1960s.
The London office of KnightFrank advised Lodha on the deal.
"Grover Square is the best address in the world and we will create a world class development which benefits the status of the address," said Abhishek Lodha in a press statement today.
Lodha has only paid 10% of the total Rs 3000 cr for london property. Remaining to be paid by end of january. They will close deal by march 2014.
2. Canada's High Commissioner to the UK, Gordon Campbell, confirmed on Thursday night that legal contracts have been exchanged for the sale of 1 Grosvenor Square for 530 million Canadian dollars. The federal government announced in February that it was putting the High Commission up for sale as part of a cost-cutting exercise. The actual listing didn't take place until October and the seven-storey building was in hot demand, generating more than 100 viewings and 20 bids.
3. According to a report in the Business Standard, Lodha was the only one from India to bid for the 150,000 sq ft property. The other bidders included some West Asian and Russian hotel chains. CNBC-TV18 reported that Lodha has already made the payment for the property. The entire amount of Rs 3,200 crore is said to have been paid via internal accruals. Lodha Group has reportedly not taken on any debt for the deal
4. In the last one year alone, around 20 diplomatic houses or buildings have been sold or are on the verge of it in London.The median price of homes in Mayfair is around $3.5-million and most of the properties sold in the past year have been bought by wealthy foreigners. Also Foreign embassies are abandoning London's premier addresses such as Mayfair and Kensington as the world of diplomacy changes in the face of security risks and new technology.
5."The acquisition of this marquee asset overlooking London's most renowned garden square, in the heart of Mayfair, and in close proximity to Bond Street and Mount Street is a great opportunity for our company," Abhishek Lodha, MD of Lodha Group said.
6. Lodha had last year also bought the US Consulate's Washington House in South Mumbai for Rs 341.82 crore. The group is currently developing over 35 million sq ft of prime areas - Napean Sea Road, Prabhadevi and Walkeshwar.
7. Governor Square now seems to be taken over by Indian investors. At least six properties on Grosvenor Square have been lapped by Indian investors.
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Updated Date: Dec 21, 2014 00:25:22 IST