HSBC London - Most Expensive Workplace in Britain

Here is another source :
HSBC sells London base for £1.09b
1 May 2007
South China Morning Post

HSBC Holdings, the world's fourth-largest lender by market value, has agreed to sell its London headquarters building for £1.09 billion (HK$16.99 billion), the largest single property deal in British history.

The lender said yesterday that it planned to sell its Canary Wharf landmark tower to a subsidiary of Spanish property firm Metrovacesa, the biggest-listed property company in Spain.

In the agreement, HSBC will lease the building for 20 years at an annual rent of £43.5 million, with an option to extend for a further five years.

The lender said the 1.1 million square foot, 210-metre tower at 8 Canada Square would remain its global headquarters.

"This is a good opportunity for HSBC to manage its property assets effectively," said David Hodgkinson, the bank's group chief operating officer.

The bank did not say how much it expects to book from the sale or what it will do with the proceeds.

Construction of the tower cost HSBC about £500 million, the bank said.

The bank announced last year that it was studying the potential of cashing in on the surging property market in London by selling the five-year-old Sir Norman Foster-designed tower, which houses 8,000 employees at present.

Some market watchers speculated that the sale of property could help to boost the bank's earnings this year, especially as its earnings were held back by the provision for its sub-prime mortgage business in the United States last year.

Under the transaction, which is expected to be completed by next month, HSBC will retain full control of occupancy while Metrovacesa will take over its 998-year leasehold.

Citigroup's London headquarters sold for 1 billion pounds
2 July 2007

LONDON (AP) - A British real-estate consortium said Monday it agreed to buy the 42-storey tower that is Citigroup Inc.'s London headquarters for about 1 billion pounds (US$2 billion; euro1.5 billion) from Royal Bank of Scotland Group PLC in Britain's second-biggest property transaction ever.

The consortium includes Derek Quinlan, the founder of private equity and real estate group Quinlan Private, and Propinvest, a property investment company.

Located in the capital's Canary Wharf district, the building comprises more than 1.2 million square feet (366 million square meters) of space, all of which is leased by Citigroup, the world's largest bank.

"This is a long-term personal investment in a prime property in the heart of London's new financial center," Quinlan.

In April, Europe's biggest bank HSBC Holdings PLC said it had sold its global headquarters in Canary Wharf to Metrovacesa SA of Spain for 1.09 billion pounds (US$2.18 billion) in the biggest single property deal in British history. HSBC will remain in the building under a 20-year lease, with a five-year option.

That followed the announcement in February by Swiss Reinsurance Co. that it was selling its London headquarters, the 40-story glass skyscraper known as "The Gherkin," for 600 million pounds (US$1.18 billion) to real-estate corporation IVG Immobilien AG.

Citigroup will stay at 25 Canada Square after the sale under a 25-year lease that expires in 2026.

Spanish group wants HSBC to buy back London skyscraper
28 November 2008
Agence France Presse

Struggling Spanish property group Metrovacesa said on Friday it wants HSBC to buy back the London headquarters building which it bought from the global banking giant only last year for 1.1 billion pounds.

Metrovacesa said in a statement that it would propose the sale of the building in London's new financial district, Canary Wharf, to HSBC for 838 million euros (1.07 billion dollars, 705 million pounds).

Metrovacesa, once one of the top Spanish property companies, has suffered along with its peers as the real estate market has collapsed under the weight of the global financial crisis.

It borrowed one billion euros to pay for its acquisition of the HSBC headquarters building in early 2007, with a deadline Wednesday to arranging a refinancing deal on the loan.

HSBC sold the 45-floored skyscraper -- which towers over Canary Wharf in the east of the British capital -- to Metrovacesa for the then equivalent of 1.60 billion euros or 2.17 billion dollars in early 2007.

The sale allowed HSBC to remain in the building, while Metrovacesa took an 998-year lease.

The massive office block -- whose official address is 8 Canada Square -- is 210 metres (693 feet) high and contains 102,000 square metres (1.1 million square feet) of office space. It has sold for more than double the cost of its original construction.

ANALYSIS-Property vendors turn bankers to beat UK debt squeeze

LONDON, July 10 (Reuters) - Plucky property sellers are morphing into lenders to soothe Britain's real estate debt famine and turn dealmaking hopes to reality, in moves that may break the banks' stranglehold on big-ticket property deals.

Aviva Investors has thrown the issue into relief by offering debt funding to the successful bidder for a 750-800 million pound ($1.22-$1.3 billion) portfolio of 47 retail parks, offices and warehouses code-named "Project Ed".

The growing trend of vendor-arranged debt has sparked signs of life in Britain's listless real estate sector, flushing out buyers who fled when the boom turned to bust. Brokers believe the trend may in time coax typical lenders out of hibernation.

"If we see more big portfolios come up, and the debt markets have not loosened, we will see more of these types of stapled finance deals," said Cushman & Wakefield partner Alastair Hilton.

"This trend may even encourage them (banks) back," he said.

The competitive chase for "Ed" has surprised some experts -- especially since UK commercial property transactions plumbed their lowest depths this decade in the first quarter, with just 3.6 billion pounds of deals, CB Richard Ellis data shows.

SWEETENER

Rumours abound that Aviva Commercial Finance has offered 75 percent of the required capital to buy the portfolio for a seven-year period at 275 basis points over LIBOR. A spokeswoman for the company declined to comment on the terms.

The structure echoes the deal between HSBC and Spain's Metrovacesa when the ill-fated property firm bought the bank's skyscraper offices in Canary Wharf for a record-breaking 1.1 billion pounds in April 2007.

"Project Ed" is not the first time Aviva has taken up the pseudo-banker role. In March, its Norwich Union unit provided 500-550 million pounds of debt to F&C REIT to help it buy 211 properties previously owned by the failed Dawnay Day Group.

Now, Aviva is seeking a sale to rebalance its over-exposure to UK property. The stapled finance deal will reduce its asset management responsibilities and enable it to preserve an interest in the future growth of the portfolio.

The assets have an average unexpired lease term of more than nine years and are let on more than 250 tenancies.

Aviva Investors' head of Aviva Life Funds -- UK Real Estate, Joel Lindsey, said the portfolio was possibly one of the largest and most diverse collections of quality UK commercial properties to come to market this year.

"There have been increasing signs of late that UK and overseas investors are looking to move back into UK commercial real estate and the opportunity to secure debt financing is likely to further support that interest," Lindsey said.

Despite the stapled finance package, some property market experts feared the deal could still fail at the final hurdle.

They claim the rare opportunity to buy heavily discounted UK real estate in bulk has excited investors more than the quality of the assets and that a thirst to deploy capital was growing too intense to ignore.

"It's a different kind of pressure from that felt by those who have a fund that has committed capital that can be drawn when necessary. If you're sitting on cash, it does start to impact your returns over time," said one real estate banker.

What is more, the debt finance sweetener is an incentive only wealthy vendors like insurance companies and pension funds will be able to afford, meaning many firesellers could still struggle to find buyers.

With a handful of investors left in the hunt for "Ed", Aviva advisor DTZ is collecting final bids imminently.

Those expected to submit offers include privately owned real estate investment firm Topland, CIT in joint venture with Saudi Arabia's Jadwa Investment, and investment firm ROM Capital supported by Middle Eastern backers.

The deal is due to complete before end-July and some experts hope it will break a deadlock between buyer and seller in the UK commercial property market.

"The success of this deal has a big bearing on morale in the market, not simply because it is such a big chunk but also because it will reveal attitudes towards real estate outside London," said Cushman & Wakefield's Hilton.

However, the commercial property market rally is broadly seen taking longer outside London and demand from prospective buyers for provincial assets has been tentative as a result.

"The foreign interest has given London a great crutch but outside the capital, the commercial property market has a very different complexion. The market will only move on this if the pricing is right and this deal could help us discover that." ($1=.6150 Pound)

HSBC agrees sale of London HQ for $1.3 billion
13 November 2009

LONDON (AP) - HSBC is selling its 44-story London headquarters, Britain's second-tallest skyscraper, for 772.5 million pounds (nearly $1.3 billion), the bank said Friday.

HSBC Bank PLC said it struck the all-cash deal with the National Pension Service of Korea. HSBC will continue to occupy 8 Canada Square, in east London's Canary Wharf financial district, paying the new owner 46 million pounds in rent per year for the next 17 1/2 years.

HSBC recently made a tidy profit on a similar deal with Spanish real estate company Metrovacesa S.A., which purchased the building from HSBC in 2007 for nearly 1.1 billion pounds, only to sell it back at a loss of about 250 million pounds a year later.

The sheer glass skyscraper is about 200 meters (655 feet) high. It shares the title of Britain's second-tallest office building with the nearby 15 Canada Square, occupied by Citigroup, according to Skyscrapernews.com, a Web site which compiles building data.

Both are outstripped by their neighbor, One Canada Square, which stands about 235 meters (771 feet) tall.

HSBC moved into its building in 2002. It houses 8,000 staff in about 1.1 million square feet (100,000 square meters) of floor space.

HSBC has weathered the banking crisis better than many of its rivals. On Tuesday it said in a trading update that pretax profit for the third quarter was "significantly ahead" of the same quarter last year.

The bank's shares rose 1.3 percent Friday to 741.7 pence on the London Stock Exchange.

HSBC sells Paris building for $573 mln
21 December 2009

LONDON, Dec 21 (Reuters) - HSBC , Europe's largest bank, has sold its Paris offices for 400 million euros ($573 million) to private investors represented by French Properties Management, completing the sale of three properties worldwide. HSBC France, a HSBC Holdings unit, has agreed to lease the buildings at 103 avenue des Champs-Elysees and 15 rue Vernet for nine years, with break clauses in the fourth, fifth and sixth years, the bank said in a statement on Monday.

Over the past two months, HSBC has sold its European headquarters at London's Canary Wharf to South Korea's National Pension Service for $1.3 billion, and its New York City building to Isreal's IDB Holding Corp for $330 million.

HSBC said the Paris agreement would be completed in the first quarter of 2010, subject to conditions, with a subsidiary of a French OPCI (Organisme de Placement Collectif Immobilier) established for the transaction.

The deal was conditional on the City of Paris not exercising its right of pre-emption to buy the buildings in the two-month period immediately after the agreement, HSBC said.

Great, I hope the will build new shops in the building.
It was weird to see a so big place without any shop in the Champs Elysees.