BALLYMORE Properties will hand over the €45 million it is poised to make from the sale of a London development site to State assets agency Nama.
Canary Wharf Group has agreed to buy out the interests of both Ballymore Properties and British Waterways in the Wood Wharf Partnership, which controls a site earmarked for a 4.8 million sq ft office, residential and retail development.
Ballymore is selling its 25 per cent stake for £38 million (€45 million), earning it a £12 million profit on its original investment in the partnership.
Ballymore’s investment in the Wood Wharf site is not supported by any bank debt. However, the company will have to hand over all proceeds from the sale, including the profit it has earned on the original investment, to Nama.
Ballymore’s original debt to the State agency was close to €1.5 billion, but it is understood the group has paid off about half its liabilities to the agency at this point.
The developer agreed a business plan with the agency midway through last year. Nama is supporting the company’s activities in London.
The price the Canary Wharf Group is paying the Irish property developer for its 25 per cent stake compares favourably to the £52.4 million it is paying to British Waterways for its 50 per cent holding.
However, that deal does include an earn-out and enhanced ground rent payments to British Waterways, which has granted a 250- year lease of the site to Canary Wharf Group.
Wood Wharf is next to Canary Wharf in the centre of the London docklands and the buyer wanted to take complete control of the site.
Ballymore has a number of adjacent sites and the company believes their value will be enhanced by the development of Wood Wharf. It was also seeking to balance its property portfolio between central, east and west London.
Ballymore Properties is the main vehicle of developer Seán Mulryan and has interests in Ireland, Britain and Europe.
Its Irish businesses included interests in the Whitewater Shopping Centre in Newbridge, Co Kildare, the Hermitage Medical Centre and residential developments in Dublin and Wicklow.
In Britain, it is one of the bigger players in the ongoing redevelopment of London’s docklands and it also has interests in other major cities.
Mr Mulryan had investments in New York, England and eastern Europe through another vehicle, Markland, but last year agreed a five-year disposal plan for many of these assets.
Canary Wharf Group is a quoted property development company focused on the area of the same name in the London docklands, although it has investments elsewhere in the British capital.
It has already designed and built more than 15 million sq ft of commercial property at Canary Wharf, which forms the centre of the redevelopment of London’s docklands.
The company has outline planning permission for the redevelopment of Wood Wharf and detailed consent for three office buildings closest to Canary Wharf itself.
