On Tuesday, global real estate developer Lendlease announced its latest joint venture with Canadian pension fund manager CPP Investments. The venture, a 50/50 deal with the CAD 541.5 billion (about $419 billion) Canadian institutional investment, will develop a new office-led neighborhood at International Quarter London (IQL), a deal both companies have hailed as “a vote of confidence in the London office market.”
The agreement builds on a series of existing joint ventures by Lendlease and CPP Investments, which include established projects at Elephant Park in London, U.K., Barangaroo in Sydney, Australia and the Milano Innovation District, Italy.
The partnership has initially committed to developing the Turing Building, allocating approximately GBP 215 million (about $285 million) from the joint venture. The Turing Building is one of four major new office buildings planned for IQL, which combined are expected to provide a total development area of 1.6 million square feet when fully developed, with an estimated gross development value of approximately GBP 1.5 billion.
IQL is located at the gateway of the Queen Elizabeth Olympic Park and, Lendlease notes, benefits from proximity to amenities within the Olympic Park itself as well as the Westfield Stratford shopping centre and the new leisure, culture and higher education offer at the East Bank development and surrounding area. Stratford has in recent years become a hub for creative industry, innovation and business in East London; with premium transport links into Central London as well as several airports.
Construction on the Turing Building, which has been designed by award winning architects Arney Fender Katsalidis, is expected to begin in early 2022. Once complete, it will provide 350,000 square feet of flexible Grade A workspace, retail space and a boutique cinema.
“IQL is an excellent opportunity to further our existing global relationship with Lendlease,” CPP Investments’ Managing Director and Head of UK Real Estate, Tom Jackson, said. “This relationship extends to several joint ventures globally and we are delighted to undertake our second partnership here in the U.K., bringing further investment and development activity to London. Stratford is one of the city’s fastest growing sub-markets, with fantastic transport links, over 500 acres of green space, Olympic quality sports facilities and growing culture, leisure and higher education facilities. IQL’s supply of Grade A office space with strong sustainability credentials, will help service current and growing tenant demand for this sub-market. Our partnership with Lendlease forms part of our strategy to align with best-in-class delivery partners and our wider commitment to deliver steady, long-term returns for CPP contributors and beneficiaries.”
“Following a challenging year, with Covid-19 bringing uncertainty to economies across the globe, this deal is a real vote of confidence in future workplaces and London’s office market more broadly,” Lendlease’s Managing Director of Development for Europe, Bek Seeley, said. “The Turing Building will bring market-leading, flexible workspace to Stratford, sitting alongside cultural heavyweights East Bank, UCL and Here East.
“Sustainability and innovation are at the core of everything we do, and we will be working closely with CPP Investments, and other partners, to develop spaces at IQL where businesses can collaborate, create and grow, surrounded by 560 acres of parkland and waterways.”
This week, CPP Investments separately announced a $1.1 billion joint venture with Chicago-based, private equity real estate operating company and investment manager Bridge Industrial to develop modern warehouse facilities in supply-constrained markets across the U.S.
