Sovereign Wealth Fund Institute

The Qatar Investment Authority (QIA) is nearly completing the acquisition of Credit Suisse’s London headquarters. The QIA would pay £330 million for the property located in the financial district called Canary Wharf. There will be a separate sale-and-leaseback agreement to be used with Credit Suisse. The 21 floor office property is at 1 Cabot Square in London’s Canary Wharf. The building is 540,000 square feet in area.

The QIA has been an active investor and developer in English real estate. Other notable large deals in the past with Qatar’s sovereign wealth fund include, the former Chelsea Barracks site, development of Shell’s International headquarters, and development of the Olympic Village project.

The Qatar Investment Authority owns around a 6% stake in Credit Suisse and has used the bank for deals. In addition, the QIA and the China Investment Corporation own shares in UK Songbird which is the majority owner of the Canary Wharf Group.

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According to the Independent, “China’s biggest sovereign wealth fund is in talks to buy a stake in one of London’s tallest skyscrapers being developed by Britain’s largest property company.

The China Investment Corporation (CIC) has approached Land Securities about taking an equity stake of up to 25 per cent in the proposed “Walkie-Talkie”, the 500 ft tower at 20 Fenchurch Street designed by Rafael Vinoly. Land Securities won planning consent for the Square Mile site two years ago after a public inquiry sparked when English Heritage and others objected to its impact on the sight lines to St Paul’s Cathedral. The 36-storey building (down nine floors from the original plan) will cost an estimated £300m to build and is scheduled for completion in 2014.

It is nicknamed the Walkie-Talkie because of its top-heavy shape, designed to maximise high-rent floor space on the upper stories.

The FTSE-100 company entered into exclusive discussions with Canary Wharf Group to jointly develop the site in June. As part of the proposed deal, Canary Wharf would build the tower. These talks are still ongoing but it is thought that CIC, a wholly owned state company based in Beijing, has entered the negotiations.”

Read more: Independent

Gulf Times reports, “Qatar Holding, a strategic and direct investment arm of Qatar Investment Authority (QIA), will extend debt finance to part fund Songbird Estates’ purchase of additional 8.45% equity in the London’s realty developer Canary Wharf Group (CWG). Songbird Estates, in which the Qatar Holding seeks to be one of the largest shareholders, has invested £112.5mn in buying another 54mn shares in CWG, a leading real estate and development company with more than 7mn square feet of office and retail space. The purchase of additional stake will increase the share of Songbird, which is incorporated in England and Wales, in the CWG to 69.3% from 60.8%.

‘Qatar Holding will be a leading participant in a new debt facility to help fund the purchase by Songbird Estates of the additional shares in CWG,’ said a spokesman of Qatar Holding, which has agreed to fully participate in the offering to the extent of its 14.8% stake in Songbird.

However, he did not disclose to what extent Qatar Holding will partake in the debt facility. The CWG is an integrated property development and investment entity focused exclusively on Grade-A office space and high retail facilities at the Canary Wharf Estate, a 97-acre development which is part of the Central London Office Market.

‘We fully support the management of Songbird in undertaking this transaction, which we believe is a good opportunity to create value for all Songbird shareholders,’ said Ahmad al-Sayed, CEO of Qatar Holding, which will also be the lead participant in the previously announced £275mn preference share issue.”

read more: Gulf Times

Reuters reports, “Qatar Holding LLC aims to become the largest shareholder in Songbird Estates, owner of much of London’s Canary Wharf office complex, the investment arm of the Qatari wealth fund said late on Friday.

‘Qatar Holding has today announced that following the proposed equity issue and loan repayment by Songbird Estates Plc … it intends to become the largest shareholder in the company,’ the group said in a statement.

Qatar’s sovereign wealth fund on Friday joined China Investment Corporation to subscribe to 275 million pounds ($447.9 million) in preference shares issued by Songbird.”

read more: Reuters

AFP reports, “China’s state sovereign wealth fund has bailed out the heavily indebted majority owner of London’s Canary Wharf, according to the real estate development’s owner. The Financial Times reported that the move by China Investment Corporation (CIC) was its first big investment in Britain. The owners of Canary Wharf, Songbird Estates, said in a statement that CIC would form a consortium with Qatar Holding, the Qatari sovereign wealth fund, and a number of existing investors, to provide more than 800 million pounds in new equity. The money is needed to pay 880 million pounds that Songbird owes to US bank Citigroup.

David Pritchard, the chairman of Songbird, said the deal had saved Songbird from bankruptcy.

“This deal secures the future of Songbird on the best possible basis for our shareholders,” he added.

Qatar will become the largest shareholder in the group with a stake of just below 30 percent with US private investor Simon Glick taking 27 per cent and CIC taking around 19 percent, the Financial Times said. The Canary Wharf development in east London’s Docklands houses the offices of major banks and media and newspaper groups.”

read more: AFP