30 June 2011 – Property Week
Billionaires the Reuben brothers have this week bought a £130m West End estate, the most prestigious part of which has been derelict for more than 10 years, for luxury residential development, PropertyWeek.com can reveal.
The Piccadilly Estate, a group of six properties in the heart of Mayfair, was bought out of receivership by the Reubens for £20m less than the £150m guide price. The purchase ends a rocky 12 months for the historic 1.3 acre site, which was put up for sale in June 2010 after being placed into receivership and needs expensive renovation before the buildings are suitable for re-occupation.
Former owner Simon Halibi had planning consent to turn the estate into the UK’s most exclusive six-star hotel and private members’ club, but lender Lloyds Banking Group pulled the plug last year.
Its centrepiece is 94 Piccadilly, once home to the Naval & Military Club. The grade I-listed Palladian-style mansion was built in 1756 for the second Earl of Egremont and is distinctive for the labelled gates that lend it its better-known name, the In & Out club.
Property Week understands the property could be turned into a “super-prime2 home, and command up to £6,000/sq ft. It would be one of the most spectacular and valuable homes in the UK.
The Reubens, who own adjoining buildings on Whitehall Street, have been increasingly active in the prime lucrative London residential market, and are buying again after a period on the sidelines.
In February they won planning consent for the “Cucumber” in Paddington, one of the UK’s tallest residential towers. Agents who have shown potential buyers around the block said it was in need of extensive renovation, not least because visitors’ feet broke through the floor as they were walking around its landings.
Other parts of the Piccadilly Estate are 96-100 Piccadilly, comprising nine floors of offices and flats, and 90-93 Piccadilly, which is luxury flats. Most of the 180,000 sq ft that makes up the six properties are vacant and were marketed as a portfolio or in separate tranches by selling agent Jones Lang LaSalle.
The estate has been under offer several times to overseas bidders, including a Russian investor and a consortium called UUHH, for more than £200m. The second bid failed because one of the equity providers pulled out.
Other buyers, mainly contemplating hotel, embassy and residential uses, are understood to have been put off altogether by the perceived complexity of the sale process. A subsidiary of Halabi’s Anglo Swiss Holdings tried to sell the site for £250m in October 2009. It bought it 10 years earlier from the Naval & Military Club.