A gate too far: Broadgate sale collapses

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The Independent Online

MGPA, the Macquarie Group-backed Australian fund, is understood to have abandoned plans to purchase Broadgate, the City office scheme owned by Ftse 100 property giant British Land.

British Land was looking to sell a 50 per cent stake that would have valued the complex at £2.5bn. Broadgate has an estimated £2bn debt, of which MGPA would have assumed half. This meant it would have needed to have written a £250m cheque to purchase the 50 per cent shareholding.

MGPA wanted to find a partner to share the stake, and is understood to have approached the sovereign wealth fund Abu Dhabi Investment Authority. But, it could not find a partner.

A property source said: "A lot of capital expenditure is needed to improve Broadgate and a number of major tenant leases are coming to an end, making a deal less attractive."

Broadgate's tenants include banking group UBS and law firm Herbert Smith.

A spokeswoman for British Land said: "We have never confirmed or denied details about the interested parties in any of our assets. It [Broadgate] is an attractive and successful asset and one that British Land is happy to have on its books."