Legal & General secures Transport for London's Stratford building for £246m
The latest in a series of Legal & General initiatives to invest long-term capital across the towns and cities of the UK.
Legal & General Retirement (LGR) announces it has completed the purchase of The Transport for London (TfL) Building at The International Quarter in Stratford for £246m from Lendlease and LCR. This strategic investment is the latest in a series of Legal & General initiatives to invest long-term capital across the towns and cities of the UK.Other recent transactions have included regeneration in Leeds and Cardiff, as well as town-centre refurbishments, regeneration, commercial and housing projects in locations including Salford - with Media City - Bracknell, Canning Town and Walthamstow. To date, Legal & General has made £6.6bn of a committed £15bn of new direct investments in the UK.
UK urban regeneration and infrastructure investment stimulate employment and economic growth and provide a strong economic multiplier effect - Legal & General estimates that every £1 invested in physical infrastructure generates around £3 of local economic activity. They also offer an important asset class for L&G's long-term capital, including the £45bn annuity book, as they provide stable revenues and enhanced long term returns to help fund the retirement income of our customers.
Kerrigan Procter, Managing Director of LGR, said: "This is a great deal for L&G and our annuitants, as well as for Stratford, where we expect to see real growth in jobs and homes as The International Quarter becomes operational. It is further evidence that we have the scale and the expertise to make a real difference by making our long-term funding available. The UK is a great place to invest and investing in real assets is economically and socially useful; we intend to do more."
Gordon Aitchison, Director of Investment and Development at Legal & General Property, added: "With significant volumes of patient capital under management, we believe that it is inevitable that the private sector in the form of long-term institutional investment plays a meaningful role in bringing about major regeneration and driving UK economic expansion. A significant new growth area for London, it is anticipated that Stratford will benefit from the creation of more than 40,000 new jobs and 11,000 new homes in the coming years."
Dan Labbad, Chief Executive Officer, International Operations at Lendlease, said: "Today's announcement illustrates the confidence the investment market has in this approach and the opportunity presented by The International Quarter, London's fourth major business district. This is a fantastic example of how the Olympics continues to bring lasting prosperity and employment opportunities to East London."
David Joy, LCR chief executive, said: "Today's announcement unlocks further value from The International Quarter, a major new employment hub in East London. Our partnership with Lendlease will bring 25,000 new jobs to the area by 2025, continuing the transformation of Stratford into one of London's most vital and vibrant communities."
Cushman & Wakefield advised Legal & General Property on the deal, while JLL acted for Lendlease and LCR.
For further information, please contact:
Richard King, Head of Group Corporate Communications
020 3124 2095
Olivia Bayliss, Head of Communications, LGIM Real Assets
020 3124 2777
Notes to editors:
The TfL Building
As one of the largest integrated transport authorities, TfL's role extends to the maintenance and infrastructure monitoring of the London Underground, London buses, the DLR, London Overground, Thameslink, River Services, Victoria Coach Station and Santander Cycle Hire, as well as regulating the Congestion Charge scheme, taxis and private hire trade vehicles.
The TfL building, which is in the early stages of construction, will sit at the gateway to Queen Elizabeth Olympic Park and will house 3,000 TfL employees from autumn 2017 on a 25 year lease. The 286,000 sq ft office-based scheme has been acquired by way of a forward funding agreement from Lendlease and London & Continental Railways (LCR), who are developing the wider £2.3bn site, one of the largest new commercial developments in London.
Legal & General Retirement
Legal & General Retirement has participated in the insurance solution pension de-risking market for nearly 30 years and was voted Risk Reduction Provider of the Year at the 2014 and 2013 UK Pensions Awards and Risk Management Provider of the Year at the Pensions Age Awards 2014. Legal & General was also voted Insurer of the Year at the 2014 Insurance Risk Awards. Legal & General provides annuities to pensioners and has completed a number of landmark transactions. These include the $900m deal with Philips in the US in partnership with the Prudential Insurance Company of America in 2015, the £3bn bulk annuity arrangement with the ICI Pension Fund, the largest bulk annuity policy arranged by a pension scheme in the UK to date, secured in March 2014 and the £3.2bn longevity insurance transaction with the BAE Systems 2000 Pension Plan in February 2013. Legal & General manages £43.1bn of annuity assets as at 30 September 2015.
Legal & General offers a range of de-risking solutions, which includes buyout, buy-in, longevity insurance and liability-driven investment (LDI), to pension schemes of all sizes. Legal & General is also able to tailor a combination of LDI and longevity insurance to provide "DIY buy-in" solutions. Legal & General has expertise in investment management, all aspects of defined benefit provision as well as an in-depth understanding of mortality trends and longevity risk. The excellent services we are able to provide also include payroll, administration and communications services.
LGIM Real Assets
LGIM Real Assets is a wholly-owned subsidiary of Legal & General Investment Management (LGIM), one of Europe's largest institutional asset managers and a major global investor. LGIM manages £717bn in assets on behalf of over 3,100 clients (30 September 2015), providing products and solutions spanning all asset classes. LGIM Real Assets, headed up by Bill Hughes, has an aggregate asset value of £19.9bn (30 September 2015) and is responsible for the company's direct investment capabilities in property and infrastructure. The company is made up of three specialist divisions, Legal & General Property (LGP), its property fund management arm, LGIM Infrastructure, its infrastructure lending and investment division, and Commercial Lending Limited (CLL), its commercial lending arm.