Investec Real Estate (“Investec”) announces that it has provided LCN Capital Partners (“LCN”), a private equity real estate firm, with a £122 million loan for the development of a 283,000 sq ft best-in-class office scheme in Kingston Upon Thames, Southwest London. Unilever, the FTSE 100 multinational consumer goods company, has agreed a pre-let for the entire building for its new global headquarters.
Alongside Investec’s £43 million commitment, £79 million of debt has been arranged with Allied Irish Bank (GB) and Bahrain-headquartered Bank ABC. The transaction represents the largest office development loan in Outer London in 2023, and reflects Investec’s strong conviction in technology-enabled modern office assets in prime and emerging locations with strong ESG credentials, increasingly focused on individual health and wellbeing.
The Unilever Campus, which is expected to be delivered in late 2024 / early 2025, is being developed by Cube Real Estate and will include 283,000 sq ft of state-of-the-art office space across two interlinking glass-fronted buildings, as well as space for 354 cars (30% EV charging enabled) and 325 bicycles. The development will create approximately 2,000 jobs in the local area and is targeting a BREEAM ‘Excellent’ certification and to be carbon net zero in operation, with efficient office layouts, high performance insulation, considered material selection and rooftop photovoltaics.
Investec has a growing track record of executing major club deals on behalf of its clients, alongside an expanding syndication offering, which enables it to support its clients beyond the scope of its own balance sheet. Through its continued partnerships with several global funding partners seeking exposure to the attractive returns available from the UK real estate sector, Investec-arranged club or syndicated real estate financings to date total c. £950 million.
Hollie Sleigh, Investec Real Estate, commented: “This is our largest club deal since January 2022, demonstrating our growing expertise in arranging larger, £100m+ loans and supporting landmark real estate schemes. Leveraging our network of like-minded global banking relationships, combined with our 30-year, through-the-cycle UK lending platform, has enabled us to deliver an innovative solution for LCN.
“As businesses of all shapes and sizes accelerate their return to the office, we are seeing an increasing bifurcation in the London office market. Grade-A, highly sustainable assets like the Unilever Campus, that enable employers to provide the optimal working environment for employees in order to attract talent and foster a strong sense of identity with creativity and collaboration at its core, remain in high demand. The outlook for non-ESG compliant offices, particularly in secondary and tertiary locations, is a lot bleaker. We will continue to back clients and projects on the right side of this widening divide.”
Ward Stocker, LCN Capital Partners, added: “LCN is pleased to be partnering with Investec, Allied Irish Bank (GB) and Bank ABC to underwrite what is an iconic, best-in-class and tenant critical building with strong ESG credentials. We are committed to supporting tenants operate the very best real estate, whilst maintaining our position as a long-term investment partner. The tide has changed in real estate and in today’s world, our strategy is focused on delivering next generation real estate.