LONDON-Bluebutton Properties, a joint venture between Blackstone Group and the British Land Co., has signed an agreement to build a new 700,000-square-foot UK headquarters building for UBS AG. The new $540 million office is planned on the site of two existing offices in the venture’s 4.4-million-square-foot Broadgate complex.
The Swiss bank has agreed to lease the proposed building for $86 per square foot for 20 years. The company does have a clause that would allow it to leave the top floors after 10 or 15 years into the lease.
The new address for UBS, which already occupies about one million square feet in the complex, will be 5 Broadgate. The venture plans to demolish 4 and 6 Broadgate, worth about $175 million, to make room for the new office.
Construction on the new building is expected to start in mid-2011, provided approval of a planning application from the city. British Land will develop the building and will receive fees for the work. The tenant may be able to move in by Q1 2016 at the earliest, said British Land in a statement.
“We are…excited to have the chance to make a substantial investment in a project that will rejuvenate Broadgate and retain 5,000 employees in the city of London by ensuring a high quality work environment,” said Chad Pike, senior managing director of Blackstone, in a statement. Broadgate, at 96% occupies, has been developed in phases over 25 years, and includes 16 buildings of office, retail and leisure space. Blackstone purchased its 50% stake in Broadgate late last year, paying $3.4 billion.
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