LONDON | Project Compilation Thread

[Fabb]

^^^The renderings of the Heron Tower are very realistic. I like them.

[wjfox2004]

New renderings of the Minerva scheme in Aldgate:

http://www.building.co.uk/story.asp?...de=3110904&c=1

[pricemazda]

such a let down...

[jef]

JP Morgan: axe to fall on 40,000 London jobs
Siobhan Kennedy

In the most dire forecast so far of the impact of the worldwide credit squeeze on UK jobs, it was today predicted that as many as 40,000 posts in the City will be cut.
...
Banks such as HSBC, Citigroup and Morgan Stanley have been axing staff as demand for complex debt and mortgage products has dried up in the wake of the global squeeze on credit.
...
Based on a rough space requirement of 150 square feet per office worker, 40,000 jobs equates to about 12 of London's landmark "Gherkin" buildings.

Thus, city vacancy rates were likely to reach 12.2 percent in 2009 while City office rents were set to decline by 16 percent in 2008-2010.

[wjfox2004]

New rendering of the City, courtesy of Hayes Davidson -

[wjfox2004]

Elephant & Castle video I made -

http://www.youtube.com/watch?v=xHc4gaFRJLw

[Shep]

Originally Posted by wjfox2004

Elephant & Castle video I made -

http://www.youtube.com/watch?v=xHc4gaFRJLw

A bit short!

Cheers for all the info and now all the moving picture stuff!

Tis appreciated!

[jef]

London Office Market Faces `Stress' Amid Credit Slump

By Neil Unmack

April 23 (Bloomberg) -- London's office market faces ``imminent stress'' as the fallout from the global credit crisis weakens demand for space in the city's financial district, Moody's Investors Service said.

Conditions in the City of London deteriorated faster than any other European market last year, Moody's analysts wrote in a report on commercial mortgage-backed debt today. Markets across Europe may worsen if the credit crisis continues and the supply of property increases, the New York-based ratings firm said.

Banks and securities firms may cut as many as 40,000 jobs in London in the coming months, according to forecasts by analysts at JPMorgan Chase & Co. About 7.3 million square feet of office space is due to be completed in London this year with a further 8.3 million square feet available by 2010, CB Richard Ellis Group Inc., the world's largest realtor, said in a April 21 report.

``We regard the growing supply pipeline to be an important threat to the European office occupation markets,'' wrote Moody's analysts Rod Bowers and Jeroen Heijdeman in London. ``In addition, occupier demand could be negatively affected if the financial turmoil in the global market continues for the next few quarters.''

Moody's report scores cities out of 100 based on factors including vacancy rates, the demand for property and expected supply. The analysis covers 24 European office markets including Paris, Munich and Barcelona. The average score fell to 61 from 64.

The City of London's score dropped to 20 at the end of 2007 from 53 a year earlier, Moody's said. A level of 33 or below indicates markets under ``imminent stress'' where supply is outstripping demand, usually coupled with rising vacancy rates.

Paris' La Defense financial district, previously the highest-ranking market, fell to 67 from 88. Dublin scored worst at 15, though up from 0 a year earlier, according to Moody's.

Conditions improved most in Edinburgh, which rose to 88 from 59, making it the highest-scoring market. Any city scoring above 67 is considered ``basically sound,'' with demand for property typically outpacing the growth in supply, the analysts wrote.

Banks sold 1 billion euros of commercial mortgage-backed securities in Europe this year, down from 15.8 billion euros a year earlier, according to Deutsche Bank AG data.

Investors are demanding 2.25 percentage points more than benchmark rates in extra yield to hold commercial mortgage bonds in pounds with the highest credit ratings, more than twice the spread at the end of last year, Dresdner Kleinwort data show.

[jef]

Property Week:
The house of Morgan
25.04.08

One year after the 1m sq ft deal was struck, will JP Morgan honour its costly commitment to relocate to the City of London after taking on the liabilities of Bear Stearns?

By Deirdre Hipwell

While US banks have caused huge trouble in the City of London with the ripple effect from their cesspool of subprime debt, one bank may prove to be the City’s saviour.

JP Morgan brokered one of the City’s biggest occupational deals 12 months ago, with developer Hammerson and the City of London, when it agreed to locate its 1m sq ft London headquarters at a site between London Wall and the Barbican.

Next Friday marks the first-year anniversary of the deal. But one year on, no contract has been exchanged, the agreement is still conditional and no planning application has been submitted.

The project faces several challenges, from local planning, design and cost concerns to the wider issues facing a bank that just one month ago agreed a $236m (£118m) takeover of Bear Stearns. That deal has also not completed.

As JP Morgan attempts to conclude the biggest rescue of a US bank since the Great Depression and reviews a property strategy that now has to consider property liabilities held by Bear Stearns, the City market is nervously speculating about whether its London headquarters will become a reality.

If the proposed development, codenamed ‘Project Centurion’, was considered a vital move for the City’s future before the credit crunch and the property downturn, it is now critically important to a market with burgeoning supply and weakening demand.

For JP Morgan, however, deciding if it will go ahead with its hotly anticipated relocation will most likely come down to the same rationale that informed its original decision: cost.

And the costs are looking somewhat expensive in the current climate.

JP Morgan has seven principal sites in central London, comprising around 2m sq ft of offices housing about 12,500 staff (see box, overleaf). It pays an average rent of £45/sq ft, which equates to around £90m a year.

Its agreement last year, which is renewed on a rolling exclusivity arrangement, was formed around the idea of having a central London campus where it could house three arms of the banking business: investment banking, asset management, and the treasury and securities division.

The plan, which was formed with advice from DTZ, will involve the redevelopment of the 1970s St Alphage House site and will incorporate Telereal’s former Telephone Exchange building, which was granted planning permission for the ‘ski slope’ office scheme (pictured overleaf) in February. No official timeline has been set but it is understood that JP Morgan wants to occupy the building by around 2012/13.

Conservative cost estimates suggest the relocation could cost £1bn-£1.5bn. This includes land and long-leasehold acquisition costs of between £90m and £150m.

According to the City of London 2008 budget, published on 19 February, JP Morgan must pay £91m, based on non-negotiable land values from last year, for the purchase of the long-leasehold interest in St Alphage House.

The City of London also still has to deliver another interest in the site.

Hammerson will become the project’s development manager – an arrangement that will begin once the deal becomes unconditional. It will be paid a fee by JP Morgan, which will own the building. Hammerson has not been paid any fee to date.

Construction costs could be as high as £650m because the scheme, which is still being designed by Kohn Pedersen Fox Architects and KKS Strategy, will have a highly technical fit-out and will demand a difficult construction process because of the site’s constraints.

A source close to the deal estimated that the construction costs on the 1.4m sq ft gross area could be around £450m or £325/sq ft, and that additional fit-out costs could be £175/sq ft-£200/sq ft, totalling £200m.

Hammerson is already keeping a tight rein on any future cost overruns and is looking at setting a fixed-cost construction fee structure rather than a construction management arrangement.

Counting the costs

There could also be some additional expenses for JP Morgan from existing lease liabilities on buildings it will vacate.

“Hammerson is already keeping a tight rein on any future cost overruns”

However, it is difficult to estimate any mitigation costs because it may have managed any liabilities by the time Hammerson’s scheme is completed. Hammerson and the City are not contractually obliged to assist JP Morgan in managing any lease liabilities on the buildings it will be exiting.

However, while JP Morgan’s lease liabilities may not concern the City, the £91m disposal of its leasehold interest is dependent on planning. In its total capital receipts entry, it said: ‘In particular, the St Alphage House [£91m] disposal depends on securing planning permission for the new development.’

Planning consent will be considered by the City’s planning office, which must also consider the vociferous objections from residents of the Barbican estate, where the City is also the freeholder. The financial and planning situation raises several conflicts of interest for the City, which has already shown it will go to great lengths to keep JP Morgan in the Square Mile.

A spokesman for the City, which is advised by Knight Frank, which also advises Hammerson, says its separation of functions – between its quasi-judicial role of planning authority and its stewardship of the City as a large landholder – has long been managed in a ‘very publicly accountable way’. He says this role ‘enabled the Barbican to be created in the first place’.

The spokesman adds: ‘This separation of functions is well defined. The planning authority must act according to defined guidelines and public strategies that balance the needs of residents, business and visitors, while the property team is charged with using our assets to improve the Square Mile.

‘Anyone is entitled to attend planning meetings and many do and that the committee’s decisions are subject to legal challenge and refusals may be the subject of appeal.’

The Barbican Association is most likely to be attending planning meetings as it gears up to fight a battle at the site. The association, which is chaired by Lovells solicitor David Graves, has hired its own planning consultant and rights-of-light expert to advise it once a planning application has been submitted.

No final design has been agreed yet but early plans for the scheme have already drawn mixed responses. The association’s main concern is the perceived danger to the City’s high walkways, and the ‘bulkiness and massing’ of the scheme, as well as the height of one of the proposed buildings.

Graves says, that while the residents appreciate the economic importance of JP Morgan to the City, the association wants a ‘sensible symbiosis and not one interest riding roughshod over another’.

He says: ‘Our major concern is that JP Morgan is trying to fit a quart into a pint pot.’

Smashing city Floorplates

Some critics agree with Graves, while other proponents of the scheme stress that the design has not been completed and will be shaped to fit the site. What is non-negotiable, however, is that the bank wants trading floors of a minimum of 72,000 sq ft, which will be one of the biggest floorplates in the City, and which could be difficult to deliver on a tight site.

It is thought that property investors Moises and Mendi Gertner’s Fordgate Group, which owns the adjacent 21 Moorfields site, has offered its site for sale to the Project Centurion team for around £75m.

Such an acquisition would add a further 450,000 sq ft of developable space to the JP Morgan site. However, it is thought that this has already been ruled out, as part of Fordgate Group’s site is over Moorgate station, which is a security concern for the bank.

Furthermore, any additional space that could be added would equate to longer and narrower floorplates, which one source says: ‘You would need a taxi to get from one end of the building to the other.’

Space is clearly important for JP Morgan, which wants trading floors that can house up to 1,000 brokers. Over in Docklands, Canary Wharf Group, with its neatly assembled Riverside site, large floorplates and clutch of US banks already on the estate, knows this, and may be considering making another approach to JP Morgan.

It was bitterly disappointed to lose out the first time and, given JP Morgan’s liability for the Bear Stearns building under construction at 5 Churchill Place, Canary Wharf could be considering a rearguard action.

One source says an ideal scenario for the group would be to take back the Bear Stearns office and renew its proposals at the riverside site. However, sources close to the deal say JP Morgan is committed to the City.

The City market certainly hopes so as the alternative could be unthinkable.

JP Morgan’s London holdings
-
JP Morgan’s portfolio is mostly in the City of London. It features the two main locations of Alban Gate at 125 London Wall, which houses most of its trading floor activity,
and 60 Victoria Embankment, where it has around 330,000 sq ft.

Alongside its new headquarters, it plans to retain these two locations, as well as its offices at 10 Aldermanbury Square, which houses its Cazenove investment arm.

Among its other City offices are 80 and 100 Wood Street and 20 Finsbury Square.

In the West End it occupies Almanac House in St James’s Square. The Bear Stearns liability, assuming the takeover deal completes, will comprise around 10% of its total London portfolio. There is no indication at present that JP Morgan plans to release this space back to the market.

The bank’s property strategy is headed by in-house UK property head John Clare.

[ismail]

nice find Jef.

off course,from a skycraper point of view, the Canary Warf scenario would be the best. It would mean 2 of the tallest buildings in London would get built, and what will, frankly, be a totally non discript stubby box in the city would not.
The Bear sterns building is not too big and should be convertible to a multilet scheme

[jef]

Let's hope so. Riverside South would be perfect.

Massing of the 23 storey building proposed at 25 Churchill Place.

[jef]

Two screenshots taken from Google Earth V4 Beta which now allow to look upwards:

[wjfox2004]

Heron Tower is now officially u/c -

http://www.skanska.co.uk/skanska/tem...e.asp?id=11235

Bearing pile commencement

The start of the installation of the bearing piles is a milestone, a key activity target, in the programme to construct the Tower. The 17.3.08 was set at the outset as the date when demolition and enabling works - the clearance of obstructions at pile positions and the temporary support of the surrounding streets to allow piling rigs to operate within the site footprint - should be achieved if the end date is to be met.

Cementation Foundations Skanska were able to deploy their rig, cranes and equipment and commence installation of the first pile on the due day.

[wjfox2004]

London elects a new mayor tomorrow...

Please everyone, VOTE FOR KEN.

[jef]

Revised pp at 25 Churchill Place - Canary Wharf

130m aod (80,000 sqm). 5/20 CP are 80.77 aod.

This new proposal follows "the specific requirements of a potential occupier to occupy a larger building than originally planned" and "to improve the urban design of the Churchill Place area".

The four elevations have been conceived as independent elements separated at the corners. Each has been individually designed to respond to the specific orientation and varying environmental conditions of each side of the building to minimise energy consumption. This has been achieved without affecting the overall visual coherence of the building. 4.6 The separation of the elevations at the corners offers the opportunity to create a design feature and helps articulate the increased height of the façades.

The views of the building from Jubilee Park and Montgomery Square inform the angling of the south-western corner. The western facade of the building is enlivened with three atria and main entrance at the north-western corner is accentuated by angling the bottom of the façade to allow the building to open up at the base.

Looking south east:

[jef]

revised 124m tower proposed at 25 CP.
Hertebelow the model. Difficult to texture due to the lack of decent rendering.

[wjfox2004]

Looking seriously dense there.

[jef]

much-needed boost to the occupier market:

- Bank of Tokyo Mitsubishi have shortlisted Ropemaker Place, Drapers Gardens and Arrowhead Quay for their 13,900 sq m requirement.

- ING have instigated a search for a new 18,600 sq m London headquarters

- Macquarie have recently come back into the market with a 20,000 sqm requirement, looking at Ropemaker Place and Minerva House.

- TfL is rumoured to be looking to sublet 10,000 sqm at 25 Canada Square following the release of 16,400 sq m by Citigroup.

- News International is said to have shortlisted 25 Churchill Place, Minverva's St Botolphs House, and Delancey's York House at Westminster Bridge Road for their new 40-50,000 sqm HQ.

[wjfox2004]

Oh Jesus...


http://www.cnplus.co.uk/News/2008/05...50m_shard.html

Shard busts budget

Published: 14 May 2008 15:56 Author: David Rogers

Mace has been given more time to work up costs on plans for London's tallest building after blowing its £350 million budget by more than 10 per cent.

The firm was due to have delivered cost details on the Shard of Glass to developer Teighmore yesterday. The proposal was timed to coincide with the arrival of a delegation of investors from the Qatari banks funding the scheme, which have insisted on a £350 million fixed-price contract.

The current figure is understood to be around £400 million. Mace now has until the end of the month to get the figure down - although it is expected to be still well above the £350 million demanded.

John Doyle is being lined up for the concrete contract, which includes the basement, sub and superstructure work.

Mace is believed to have asked the firm to redraw designs for the substructure to get the cost of the concrete package down. This has come in at around Ł45 million Đ more than 20 per cent higher than Mace was expecting.

Mace declined to comment but one source said: "There are a few areas that need to be rebid and re-engineered. It is tight on budget and whether they get it on budget is a big question."

The main problem is with the basement works - because of its proximity to London Bridge railway station - and these are expected to take up to a year to complete. The source added: "The real risk is in the basement and Doyles and Mace are trying to work out how to carry this without carrying too much exposure."

Keltbray has already begun tearing down the existing building at London Bridge that will make way for the Shard and is also carrying out groundworks ahead of Stent moving in for piling work. The official completion date is still the end of 2011.

But news of the latest budget problems raises fresh fears that Teighmore, which is led by the chairman of Sellar Property Group, Irvine Sellar, will have to pay more for the 310 m high structure or risk it never getting off the ground.

Teighmore has a month to decide what to do with Mace's offer. The most likely outcome is that it asks Mace to retender some of the bigger packages such as M&E and steel. These are priced at £60 million and £28 million respectively.

Last autumn, Teighmore turned its back on Mace when it asked Laing O'Rourke to come up with proposals for the building after deciding the original route of construction management would be too expensive.

But the country's largest private contractor never actually came up with a firm bid - after being trumped by Mace which agreed to carry out the deal on a fixed-price.



Who's won what

Demolition/groundworks Keltbray
Piling Stent
Concrete John Doyle
Steel Cleveland Bridge
M&E Hotchkiss (mechanical); Phoenix (electrical); Balfour Kilpatrick (electrical)
Cladding Scheldebouw


Analysis: Will fear of risk cut down the project?

By David Rogers

Right now, it is fair to say that two questions arise with the Shard. First, is this ever going to get built?

And if it does, who will build it?

Nobody can give a definite answer to either question. It's likely that the best answers would be "probably - but we've no idea when" and "at the moment Mace, but who knows?".

There was a certain inevitability that a new method to build the Shard - beset by budgetry problems for years now - would end up costing more than the bankers would ideally like.

It is up to Mace to get the figure down to what it wants. If not, it and the developer face a terrible dilemma - pull it now or go ahead and build it knowing it could end up costing even more than they ideally want to pay.

The trouble, as ever with a project like this, is the risk. No one wants to catch a cold. Not Mace, not its subcontractors and not the banks. A state of impasse or a rethink - lopping some floors off perhaps? - is looming.

[Newcastle Kid]

Originally Posted by wjfox2004

A state of impasse or a rethink - lopping some floors off perhaps? - is looming.

That will never happen. They cut floors off the building, they will have less profit in the end. There is no point.

That is just a journalist thinking they know what they are talking about, when in fact they don't. There is absolutely no evidence to say that will happen, it's just the journalists opinion. And you can bet they are 100% wrong.