Hong Kong-listed developer CC Land has signed an equity commitment letter for up to £93 million of investment as part of a refinancing agreement for the £1.2 billion mixed-use redevelopment of the once-famous London department store, The Whiteley in Queensway.
Equity commitment letters are used to demonstrate to lenders that a borrower has additional resources and liquidity options to meet its repayment obligations under a credit facility if its assets are at some future point in time insufficient to meet those obligations.
The redevelopment of the 1-million-square -foot department store building saw it formally reopened last month with a large party at which singer Rag 'N' Bone man performed. It is being completed by CC Land alongside MARK, the rebranded Meyer Bergman, and residential development manager Finchatton. They have developed 139 luxury apartments, a 109-room Six Senses Hotel, and 19 restaurant, retail and leisure units, with tenants including Everyman Cinema, Third Space and Pachamama Group.
In 2019 CC Land Holdings invested £182 million to take a joint venture stake in the regeneration and redevelopment project alongside Meyer Bergman.
The mixed-use scheme had secured planning permission in 2016 for plans that rejuvenate the northern end of Queensway, within walking distance of Hyde Park and Notting Hill in central London and are the centrepiece of a £3 billion regeneration of Queensway.
The parties at the time said they expected to invest a total of approximately £400 million to bring the redevelopment project to completion. Funds managed by Apollo Global Management provided the construction facility of £850 million for the development.
In an Hong Kong filing on Thursday, CC Land said on 25 April, a £505 million facilities agreement was completed with the original lender to refinance existing debt and finance the cost of carrying out the development.
CC Land added that it signed an equity commitment letter on 25 April that saw it agree that it would make equity contributions in respect of the costs, expenses and liabilities of the borrowers up to a limit. The statement said the agreement will ensure that the joint venture has sufficient funding for refinancing existing debt and financing the cost of carrying out the redevelopment.
It says the maximum exposure of liability is £93,150,000. As of the date of the announcement, the joint venture is ultimately owned 47.16% by CC Land and 52.84% by MB Investor or Meyer Bergman.
CBRE Loan services is advising.
The Whiteley was completed in 1911 by William Whiteley as one of London's first department stores.
The Foster + Partners-designed apartments at the scheme are now 70% sold with owners beginning to moving in from late 2024. The apartments are achieving an average of £3,600 per square foot, and a 200% premium over the surrounding Bayswater area, according to Savills.
Last year, the developers confirmed the signing of a string of commercial tenants, bringing that element of the landmark development to 80% prelet, with the retailers due to open this summer.
Chinese contemporary art gallery 3812 Gallery is opening in a 2,800-square-foot unit, alongside delicatessen Melrose and Morgan, Turkish restaurant Cleo and boutique café Yuum. In May last year it emerged that Gruppo Statuto, the Italian real estate group, had bought the 109-room Six Senses hotel at the development for £180 million.