Taylor Wimpey is in advanced talks to buy one of London’s most sought-after development opportunities – the £200m Royal Mail site on Mount Pleasant in Farringdon, EC1.In a vote of confidence in the capital’s choppy prime residential market, the listed housebuilder is close to transacting on the majority of the Royal Mail sorting office, which was put up for sale in February through Knight Frank.The site was given a £200m price tag and the end value of development could hit £600m.
A planning application for 681 homes, of which 163 are affordable, was consented in March 2015. Plans for the 6.4-acre site also include 23,000 sq ft of retail and community space. The scheme is designed by AHMM, Allies & Morrison, Feilden Clegg Bradley and Wilkinson Eyre.Royal Mail is looking for an outright sale of the leasehold of the building, but will retain the freehold. Proceeds from the sale will be used to modernise and redevelop the adjoining sorting office site, which it will retain but build over.Mount Pleasant is one of three large development sites that the Royal Mail has earmarked for property development in recent years.
Its Paddington office was sold in late 2014 for £111m to Great Western Developments, and plans were submitted first for Sellar Property’s Paddington Pole and subsequently Cube. The sale of its former sorting office site in Nine Elms, SW8 to Greystar is ongoing with a sale was recently agreed for two plots consisting of 894 homes for £101m. Capacity for a further 1,000 units across five plots at Nine Elms remain.The Mount Pleasant deal, should it complete, would be a major re-entry to the high-end central London market for the UK housebuilders, most of which had shied away in the past 18 months owing to high prices, failing sales and then the uncertainty caused by the Brexit referendum.
It is the fourth major residential deal to come to light in recent months, alongside the sale of CLS’s Vauxhall Square to R&F for £157.8m, Greystar’s Nine Elms purchase, and the exchange of contracts between St Modwen and Wanda UK for the £470m Nine Elms Square site yesterday.Mount Pleasant has historically been mired in controversy.In 2015, London’s now deputy mayor for housing, James Murray, criticised the planning application when he was executive member for housing at Islington Council. He said an opportunity to build hundreds of “genuinely affordable homes for local people” had been missed.That year local residents then put together a rival masterplan with backing from Legal & General on the grounds that there was not enough affordable housing and decried the “fortress-like” scheme.However, then mayor of London, Boris Johnson, stepped in to override the planning objections of the Labour-led local authorities of Camden and Islington, which had recommended a refusal.