UK office fund Welput has secured a £400 million ($525 million) development loan for its ambitious “all electric” office project in London.
Public Sector Pension Investment Board (PSP Investments), one of Canada's largest pension investment managers, has co-invested alongside existing Welput investors in the development, while Allianz Real Estate provided around £200m of the new £400m development finance facility, which will partly fund the construction of the scheme.
The funding announcement follows news that Skanska has signed a contract with Welput, a specialist central London office fund managed by BentallGreenOak, to deliver the mixed-use commercial development in Victoria, London on the site of a House of Fraser department store. The development contract is £235 million and the end value of scheme is projected to be £1 billion.
The 470,000 sq ft office project is not only the largest speculative office development in London since the pandemic, but will also break new ground in sustainability. It will deploy new innovations in ultra-low carbon construction to ensure the carbon emitted in the construction cycle will be offset within six years of building operations.
The building will be the largest all-electric office in the UK, said Welput, with no gas supply and no diesel generator and there will be no fossil fuels used, not just in operation but also during construction. The building is designed to surpass BREEAM ‘Outstanding’, Energy Performance Certification (EPC) A, and WELL ‘Platinum’ certification and Royal Institute of British Architects (RIBA) 2030 sustainability targets.
As well as office space, the development will feature 30,000 sq ft of green space, ground floor retail and public open space.
BentallGreenOak’s Ker Gilchrist said: "This project is surpassing the existing and emerging standards for green development, with a comprehensive whole life carbon approach. The building will achieve net zero in construction, then operation, and after just six years of its lifespan will be net beneficial to the environment. To deliver this ultra-sustainable building and attract the next generation of aspirational tenants, we have secured a significant financial deal with partners that stand shoulder to shoulder with us on our commitment to ESG and who bring a strong track record in projects of this nature.”
Construction is due to start on site in the third quarter of 2022, with completion expected during the second quarter of 2026.