Axa Said to Weigh Delay in Building London Tower on Brexit

Updated on

Axa SA’s real estate unit will ask investors whether they want to proceed with the construction of what would be the tallest tower in the City of London now that Britain plans to leave the European Union, a person with knowledge of the plans said.

Axa Investment Managers-Real Assets, which is leading the project to build the office property at 22 Bishopsgate, will offer the other investors three alternatives, the person said, asking not to be identified because the matter is private. The investors can either stick to a plan to start work on the building this year, delay the project or sell it, the person said. The last option is least likely.

22 Bishopsgate


Pierre Vaquier, chief executive officer of the unit, said shortly before the June 23 Brexit referendum that the company would wait for the outcome before deciding whether to construct the 62-story office tower. The U.K. commercial property market entered a recession in July, according to MSCI Inc., with the value of central London offices falling 3.6 percent.

“We remain committed to the site, we are continuing to work and we are considering all our options,” Richard Sunderland, a spokesman for Axa Investment Managers-Real Assets, said in an e-mail.

Axa’s co-investors in the project include Singapore’s Temasek Holdings Pte, Canada’s Public Sector Pension Investment Board and British Columbia Investment Management Corp. Spokesmen for Temasek and PSP declined to comment; British Columbia Investment Management didn’t immediately respond to a request for comment.

The Paris-based company last year bought the site of the halted Pinnacle skyscraper, saying it would build a 278-meter (912-foot) tower with 1.4 million square feet (130,000 square meters) of offices, shops and restaurants. The previous owners stopped construction on the Pinnacle in 2012.

The tower at Bishopsgate is the tallest building in the City of London to have been approved by planners. The main construction contract could be signed as soon as October if investors choose to proceed, the person said.

(Updates with responses from Temasek and PSP in fifth paragraph.)
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