CDL buys St Katharine Docks in Central London for GBP395 mil

City Developments Limited (CDL) has announced the acquisition of St Katharine Docks, a freehold mixed-use estate in Central London, for GBP395 million (approximately $636 million). This comes at a rate of GBP751 psf ($1,209 psf) on the existing net lettable area, as stated in the group’s Mar 9 press release.

The estate is a 23-acre property fronting the River Thames, and opened in 1828. It is composed of four main buildings with 500,000 sq ft of Grade A office, F&B, retail and residential spaces, and additional ancillary areas, including a 185-berth marina. The estate is located close to famous London landmarks such as Tower Bridge and the Tower of London.

Rental income is generated mainly from its 90% full occupancy rate office space Tengah EC which consists of tenants from consulting, shipping, education and co-working sectors. It has an overall weighted average unexpired lease term (WAULT) of 8.2 years (to lease breaks) and 9.4 years (to lease expiries). CDL has identified potential for positive rental reversion and asset management opportunities to increase the value of the estate.

Sherman Kwek, group CEO of CDL, commented that this acquisition increases their total commercial assets in the UK to around GBP1 billion, and enhances the group’s recurring income stream. It provides the option to inject their UK assets into listed or unlisted platforms at an appropriate timing.

The group’s other commercial properties in the UK include Aldgate House and 125 Old Broad Street – two Grade A buildings in Central London – that were purchased in 2018.