Property company offers to sell HSBC HQ at a loss

Click to follow
The Independent Online

The struggling Spanish property giant which spent a record £1.1bn on HSBC's headquarters in London's Docklands 18 months ago offered to sell it back to the bank at a loss today.

Metrovacesa, which has been hit by the collapse of the Spanish property market, wants to sell back the 690ft-high Canary Wharf tower for £838m.



This would leave it nursing a loss of €97.9m (£82.1m) after currency impacts, Metrovacesa said.



The sale talks come as the deadline on the Spanish firm's £810m bridge loan from HSBC, used to help buy the tower, expired yesterday.



Metrovacesa has not been able to refinance the loan as the credit crunch sends residential and commercial property prices into freefall.



But the Spanish firm said it has asked HSBC to consider any refinancing proposals that could appear before the sale is completed.











HSBC's base, known as 8 Canada Square, cost £500m to build and has been the global headquarters of the bank since 2002.



It is currently leasing the building, which houses 1.1 million square foot of office space, for up to 25 years and paying an annual rent of £43.5m.



The tower boasts a gym that occupies an entire floor, dining rooms, shops and a medical centre, and scored an "excellent" rating from the Building Research Establishment environmental standards body.



The bank made the sale as part of plans to exploit the value of its property portfolio - and Metrovacesa bought at the peak of the property bubble.



In the nine months to September, the Spanish firm made net losses of €41.5m (£34.8m), coming after a €111.7m (£93.6m) write-down on its portfolio.



The group is weighed down with €7bn in debt (£5.9bn) and has sold off almost 650 million euros (£544m) of property this year to generate cash as markets turn sour.

Comments