Taiwanese Developer Targets Office Deal In Gracechurch Street Tower Cluster
Taiwanese developer Farglory Land Development is in discussions to acquire a City of London office in the capital’s latest tower cluster, in what would be its first UK commercial property investment, according to React News.
Gracechurch Street has become a focal point for City development, and Farglory has reportedly agreed to buy 6 Gracechurch Street in partnership with Quadrant Estates, which has been brought in as asset manager.
The long-leasehold, multilet building consists of 47K SF of office and retail space generating a topped-up passing rent of £57.60 per SF overall, with a weighted average unexpired lease term of 7.8 years to expiries and four years to lease breaks, React reported.
The building achieved full letting in February after BT Communications leased the second and third floors, totalling circa 14K SF. It followed lettings of the 7,100 SF fourth floor to Gaws of London and the 5,300 SF fifth floor to Partner Reinsurance, totalling nearly 27K SF of lettings since the building was launched in 2023.
The building was put up for sale by owner USS earlier this year for £37.7M, reflecting a net initial yield of 6.5%. It is understood that Farglory has agreed to pay slightly below the asking price and is seeking acquisition opportunities with Quadrant to create a portfolio of London offices.
Farglory is one of Taiwan’s largest property developers and was founded by billionaire Chao Teng-hsiung, who was sentenced on bribery and corruption charges to seven years in prison in 2022.
Gracechurch Street has become the focal point for a proposed cluster of towers on the south-western edge of the main City area, including neighbouring sites 85 Gracechurch Street, designed by Woods Bagot, and the 3XN-designed 60 Gracechurch recently unveiled by Sellar.
Sellar and Japanese developer Obayashi Properties UK have plans for a £500M landmark office tower that would link the City cluster to the Walkie-Talkie building with a proposed tower at 60 Gracechurch Street.
Designed by Danish architectural practice 3XN, redevelopment will begin once vacant possession is secured in 2026, subject to securing planning consent.
Meanwhile, Stanhope and Cadillac Fairview, the real estate arm of the Ontario Teachers’ Pension Plan, in May launched plans to develop a new office-led tower at 70 Gracechurch Street, which the joint venture partners acquired from Hong Kong’s Tenacity in April 2022.
