British Land Co., the U.K.’s second-largest real estate investment trust, won approval to develop offices in a central London area that’s the hub of the country’s emerging high-tech industry, a person with knowledge of the matter said.
The City of London Corp., which governs the business district, will grant long-term leases to British Land for three sites with about 300,000 square feet (29,000 square meters) of space, said the person, who asked not to be identified because the talks are private. The London-based REIT will probably redevelop the 22 properties on the site, known as the Shoreditch Estate, into a large-scale office development, the person said.
British Land and the City of London Corp. didn’t immediately return calls for comment. Though the site is in the Tower Hamlets borough, the City is responsible for granting approval because it owns the site.
The Shoreditch properties are mostly rented to technology and media companies and they are about half a mile from the U.K. government’s Tech City project, where Prime Minister David Cameron has offered offices rent-free to small technology companies in a bid to create a rival to California’s Silicon Valley. Microsoft Corp., IBM Corp. and Cisco Systems Inc. have offices there, the government said in December.
The largest of the three sites has planning approval for more than 150,000 square feet of offices. British Land and Blackstone Group LP’s 4 million square foot Broadgate offices, which include the U.K. headquarters of UBS AG, are also nearby.
Property Week reported the news earlier today.