Qatar’s investment drive into London property is poised to focus on an unexpected area in the next few years: the 2012 Olympic Games and its real estate legacy.
Ghanim bin Saad Al Saad, Managing Director of Qatari Diar, which controls many of Qatar’s real estate investments, said yesterday the country was looking at taking part in the development behind the London games and its aftermath.
The move would mark a change in a strategy that has so far focused mainly on prestigious landmark buildings in the West End and City of London. Al Saad said: “We are looking for opportunities before and after the Olympic Games. There will be a lot of investment needed in real estate for the Olympics.”
Al Saad was clear that there would be further investment in the London market, having struck a flurry of recent real estate deals and been tipped to complete hotel acquisitions in the next few months.
Barwa, which is owned by Qatari Diar, bought a large West End development from Land Securities on Wednesday, and there are other deals being lined up to buy a stake in the Savoy hotel group by other parts of the sovereign state’s investment arm.
It is also on a shortlist to buy the Grosvenor House hotel.
However, sources close to Qatar were yesterday playing down talk of an immediate £700m bid for Songbird Estates, the majority owner of Canary Wharf Group in which Qatar Holdings is a 24 percent shareholder.
Songbird denied that there had been any bid.
Even so, the market has long been expecting a possible offer, or a Qatar-led corporate restructuring to resolve the complicated ownership of Canary Wharf.
Qatar supported a £1bn rescue rights issue and debt restructuring for the company in October alongside China Investment Corporation, China’s sovereign wealth fund.
CIC now owns about 15 percent of Songbird, with GF Investments owning about 24 percent.
Those close to Qatar have said the sovereign investor has never hid its admiration of Songbird, whose majority ownership of Canary Wharf gives it valuable exposure to the prime London office market.
During its restructuring last year, Qatar took its full entitlement in ordinary shares in addition to preference shares, warrants and participation in debt financing, showing its desire to gain higher exposure to the group.
There is also an acknowledgement among investors that the structure of the group is far from ideal.
Qatar will know that it has a strong relationship with the other major shareholder in Canary Wharf, Brookfield, which counts the sovereign state among the investors in its managed funds.
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