The US banking giants have sealed the deal on a £247m land purchase to build their own 1.9m square foot office space development in London’s Docklands. JP Morgan has signed a 999-year lease for Canary Wharf’s Riverside South site, which will be home to the company’s new European Head office.
Canary Wharf Group are to act as both development and construction manager on the project, which should be complete by 2013.
This major office space deal is a postive step for both the Docklands and the wider London office space market after many deals have failed to complete. JP Morgan themselves pulled out of an agreement with Hammerson and the City of London Corporation earlier this year.
Infrastructure work has already begun on the site, JP Morgan, currently based at a number of different office spaces around London, has instructed Canary Wharf Group to work towards completion of the design, planning and further infrastructure. Under JP and Canary Wharf’s agreement, the bank will instruct Canary Wharf Group to commence the final construction “subject to market conditions.”
If JP Morgan have to put-off or cancel contstruction of the office space development, Canary Wharf Group will be paid for all completed work and will be paid a further £76m. Canary Wharf company secretary, John Garwood said: “It is a transaction of this time in a way, it is an example of a client working with a developer to give the maximum flexibility and make sure that the end building can match as closely as possible the needs of the client in what has become a very changeable environment.”