Westminster Tower back up for sale as Third.i deal fails

Australian investor Third.i has lost its deposit on its £40m-plus purchase of Westminster Tower from CLS after the deal collapsed. CLS revealed the deal had not completed and that the tower at 3 Albert Embankment, SE1, was back on the market as it announced its full-year results this morning. Third.i agreed to buy the property in June last year. Consent is place to convert the tower into a residential building, adding three extra floors. Third.i said it was still aiming to complete the sale and was working with a new partner to buy it.Gareth Hardy, UK director and co-founder of Third.i Group: “We remain fully committed to completing the acquisition of Westminster Tower and its transformation into the Doulton. Regrettably, our original joint venture partner was unable to proceed. However, we are pleased to have now secured an alternative partner and we are targeting completion in the next four weeks.” Office specialist CLS, which has assets in the UK, Germany and France, posted a loss of £264m for the 12 months ended 31 December, up from an £82m loss in 2022. The losses were driven by continuing declines in valuations, with the UK dragging the company down. Values fell by 16.7% across its UK portfolio, and by 9.1% in Germany and France, dragging the group portfolio value down by 12.5% to £2bn. Net rental income increased by 4.8% to £113m during the period, largely as a result of indexation, strong performance from its hotel and student operations and a full-year of income from prior year acquisitions CLS said leasing activity was solid, with 130 new lettings and renewals generating annual rent of £15.5m. Chief executive Fredrik Widlund said: “CLS performed well during the period and made progress on its strategic objectives. Our high-quality estate underpinned strong leasing momentum and pricing, with new leases nearly 7% above ERV. As a result, we held our underlying vacancy rates steady and delivered net rental income growth of close to 5%. “As expected, valuations reduced in the period. However, our outperformance relative to the markets we operate in and the embedded rental growth potential in our portfolio give us confidence in our ability to deliver long-term growth. We remain focused on optimising our portfolio and reducing LTV through the course of 2024, with nearly three-quarters of the loans expiring in 2024 already refinanced, and over £270m of assets targeted for disposal.” He added: “We firmly believe the outlook for high-quality offices is bright and we are seeing a clear trend of companies thinking strategically about the return to the office as a value driver for their businesses. The investments we have made and continue to make across our portfolio mean we are well placed to thrive.”