Derwent London is pleased to announce that it has acquired the remaining 50% stake in its proposed 50 Baker Street W1 scheme from Lazari Investments, its joint venture partner, for £44.4m (£370 psf on consented floor area). This reflects a 4.2% net initial yield at the current passing income of £2.0m pa (based on 50%). Resolution to grant planning consent for a c.240,000 sq ft office-led scheme, which is nearly double the existing floor area, was received in August 2024. Detailed design work is underway.
The decision to acquire full control of 50 Baker Street was taken following the pre-letting success at our adjacent 25 Baker Street W1 project and reflects our ongoing confidence in the strength of the West End occupational market. Good progress is being made on a regear of the headleases with The Portman Estate, our freeholder and the owner of 64 Baker Street, to facilitate delivery of this exciting project. This follows our previous regear in 2021 with The Portman Estate at 25 Baker Street. We expect the scheme to deliver an attractive return in line with our current on-site projects.
Paul Williams, Chief Executive of Derwent London, said:
“West End vacancy remains low and demand from high quality occupiers across a broad range of business sectors continues to outpace supply. Underpinned by our confidence that the property cycle has inflected, we believe now is the time to acquire well-located regeneration opportunities. Our decision to take full ownership of 50 Baker Street reflects this and marks the conclusion of a successful partnership with Lazari. We look forward to progressing the project to the next stage, with works expected to commence on site in H1 2026.”
Nicholas Lazari, Director of Lazari Investments, said:
“The sale of our 50% interest in 50 Baker Street marks the culmination of a successful partnership with Derwent London. Following receipt of the resolution to grant planning in August and having made good progress on the regear with The Portman Estate, we feel the time is right to capitalise on our efforts. The cash proceeds from the sale ensures that the equity requirements for our exciting and extensive West End development pipeline are now fully funded and puts us in a strong position to realise opportunities that may arise.”