Following last week’s story on Spanish property company, Metrovacesa’s efforts to sell HSBC’s global headquarters back to the bank after failing to repay their £810 million bridging loan, it has now been revealed that HSBC have agreed to buy back their Canary Wharf skyscraper.
In completing the deal to buy back the so-called
HSBC
Tower
for £838 million, HSBC have managed to make a £250 million profit. The bank originally sold
8 Canada Square
to Metrovacesa for £1.09 billion in April 2007, at the height of last year’s property bubble.
HSBC have said that Metrovacesa’s bridging loan will be “extinguished” although the deal is still subject to some retentions and warranties.
Metrovacesa have also just completed a debt-for-equity swap with six creditor banks in order to ease their £6.1 billion of debts. The Sanahuja family of
Barcelona
, who control over 80% of the company’s capital, announced to regulators that they were going to exchange a 54.75% holding in the struggling group for the cancellation of £1.8 billion of debt. The family will also benefit from a small cash sum.
Group chief operating officer of HSBC Holdings, David Hodgkinson stated: “Clearly, the market has deteriorated significantly since we agreed the sale in spring 2007. It was important to work with our client Metrovacesa to resolve the funding issue which had arisen;
8 Canada Square
is a landmark building and this transaction is in the best interests of both parties and HSBC shareholders.”
When Metrovacesa bought the tower twenty months ago it set the record for
London
’s most expensive single-property transaction, however now
London
commercial property prices have tumbled by a third, according to Investment Property Databank.
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