BHP acquired the vacant property in the summer of 2014 following a competitive bidding process and open marketing of the opportunity. At the time of purchase, the vacant office premises were in receivership and with quickly improving office and residential markets in West London, the opportunity was of interest to many developers. The property was subject to an Article 4 Directive, a legal tool utilised by Richmond Borough Council, seeking to prevent its conversion to residential.
The Article 4 Directive allocation was successfully challenged and BHP secured PDR consent for the apartments. BHP implemented the residential business plan and successfully sold all units within 4 months of PC.
- Attractive pricing due to Receivership sale
- Excellent position opposite St Margaret’s Railway station
- Strengthening office and residential market in West London
- PDR residential conversion in a very buoyant residential market
- To secure a residential consent through PDR, thereby limiting S106 and social housing obligations
- Base case scenario as an office investment was profitable
- Office specification beyond its useful economic life
- Building style and appearance
- Restrictive covenants in place preventing residential use
- The possibility that the Local Authorities Article 4 Directive was upheld (preventing residential conversion)
- Development timetable and ultimate direction determined by matters outside of BHP’s control
- Competitor interest in the opportunity during the lengthy (vendor induced) purchase period