Carnaby Street is one of the most famous names in Shaftesbury’s portfolio
(Picture: Pexels)The biggest shake-up of the property landscape of the West End for a generation was underway today when two of its biggest players Capital & Counties and Shaftesbury agreed a £5 billion merger.
The all share deal will create a new company to be called Shaftesbury Capital with a portfolio of 670 mainly freehold buildings with around 2.9 million sq ft of lettable space across 2,000 commercial and residential units.
It brings together the biggest landowner in Covent Garden with the dominant force in Soho, Chinatown and Seven Dials, where Shaftesbry own 16.5 acres. Shaftesbury shareholders will own 53 per cent of the new group and Capco shareholders 47 per cent.
The two companies, which will combine through a reverse takeover by Capco of Shaftesbury, had gross income of £165.5 million and an estimated rental value of approximately £218 million as at 31 March 2022.
Its portfolio will be roughly split equally across retail, hospitality, and office and residential.
On current trading Capco said footfall “continues to trend towards pre-pandemic levels and customer sales in aggregate are ahead of 2019, reflecting the continued recovery of London’s West End and the appeal of Covent Garden.”
In a statement Capco and Shaftesbury said: “By combining both companies’ strengths, cultures and values as well as their proven operating and investment models, the combined group’s management team will take a “best of both” approach to operations with the aim of delivering long-term economic and social value for all stakeholders.
“The combined group will place its occupiers and consumers at the heart of the business, offering best-in-class service and focusing on providing lively, differentiated experiences for visitors, local workers and residents. The management team will bring its creative, hands-on, entrepreneurial approach to managing, improving and re-purposing assets with the intention of generating long-term income and value growth.”
It will have a loan-to-value of approximately 29 per cent and £500 million of available liquidity.
The new company will be led by Jonathan Nicholls as non-executive chairman and Ian Hawksworth as chief executive. Veteran Shaftesbury boss Brian Bickell will stepo dopwn after 36 years including 11 years as chief executive, Brian Bickell will retire on Completion. Executive directors Simon Quayle and Tom Welton, who have been with Shaftesbury for 35 and 33 years respectively, will also quit.
Ian Hawksworth, chief executive of Capco, said: “The proposed merger is an exciting opportunity to bring together two exceptional property portfolios in London’s vibrant and thriving West End. By combining the creativity and knowledge of our talented and experienced management teams to deliver sustained income and value growth Shaftesbury Capital aims to become a leading central London mixed-use REIT.”
