Heavyweights line up to board £4bn Euston estate development

By Paul Norman - Thursday, July 13, 2017 15:27

Lendlease, LandSec and Argent-Related in partnership with strategic landowner Sydney & London are among five heavyweight bidders set to make it through to the final round of developers looking to partner HS2 on the regeneration of the £4bn Euston estate in and around London's Euston station, CoStar News understands.

HS2 will unveil a five-strong development partner shortlist as well as shortlisted partners for the design contracts on the project on Monday.

It is looking for a master development partner for the 54-acre site, which comprises land owned by both the Secretary of State for Transport and Network Rail.

Following a procurement process, the chosen developer will spearhead the masterplan for the estate and secure the requisite planning permissions.

The four-year contract could be extended by up to 40 years, The Secretary of State for Transport is delivering a new terminus station for High Speed 2 at Euston Station. Network Rail owns the adjacent station and surrounding lands. SoS and Network Rail will bring together their land holdings at Euston.

SoS and Network Rail (together, the Contracting Authorities) will have entered into a collaboration agreement to effectively pool their respective ownerships in the public interest and also to streamline decision making between the contracting authorities.

The selected development partner will have the right to acquire a leasehold interest in land before developing on it.

The estimated gross development value of the entire Euston estate is between £2bn and £4bn. The scheme will run to several million sq ft of development, including extensive over-station commercial development comprising offices and retail, as well as homes and public facilities.

The vast redevelopment project is expected to run for more than 20 years and will have to accommodate changing plans for the HS2 terminus.

A development partner is scheduled to be picked by Q4 2017.

CoStar News understands that five shortlisted potential partners will be announced on Monday with LandSec, Lendlease and Argent-Related with Sydney & London among the chasing pack.

British Land, which was Network Rail’s long-term development partner for the regeneration of Euston, is understood to have decided against bidding.

All of the parties making it through to the shortlist have the experience and skillset needed for such a complex and long-term project but it is likely Argent-Related with Sydney & London will start as favourites. Argent-Related has been notably successful at the regeneration of the neighbouring King’s Cross Central Station alongside London & Continental Railways and importantly has built a strong relationship with Camden council in the process.

Its partner Sydney & London is the only landowner on the 12 acres immediately around Euston Station alongside Network Rail having assembled a portfolio of four offices around Euston Station including Grant Thornton House, which it bought in 2004. It acts as project manager for the 304,420 sq ft portfolio.

It formed the Euston Estate Partnership with US developer giant Related in 2014.

Related Cos. and Argent formed Argent Related to capitalise on their expertise and track record of significant urban placemaking in the development of all future projects in London and throughout the UK in 2015.

All parties declined to comment.

pnorman@costar.co.uk

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