ADFG's Scotland Yard deal sweetened by Brexit vote's effect on pound

Abu Dhabi Financial Group (ADFG) has saved more than US$100 million on its purchase of the Metropolitan Police headquarters in London thanks to the fall in value of the British pound since Brexit.

ADFG said that it completed a £370 million deal to buy the New Scotland Yard office block from London’s Metropolitan Police on Monday.

The deal, which was originally struck in December 2014, was seen at the time as a bullish move from the Abu Dhabi based investment company.

ADFG, which was created in the depths of the global financial crisis in 2011 and is currently developing two prime central London sites, said that it had paid a 10 per cent deposit on the property in 2014 but had not transferred the remainder of the cash until the deal completed and the police had shifted to their new headquarters on October 31.

The delay – which coincided with a 20 per cent fall in the value of the pound following Britain’s Brexit referendum in June – means that ADFG effectively netted a saving of US$109.89 million on the deal.

In December 2014 the British pound stood at US$1.55, making ADFG’s £333m payment worth US$516.15m – but since the referendum it has slumped to around US$1.22, equating to just US$406.26m.

ADFG said that it had appointed its London property development arm Northacre to redevelop the building as 485,000 square feet of apartments, 146,000 square feet of offices and 37,500 square feet of shops.

Planning consent for the Squire and Partners designed development, renamed the Broadway, was granted earlier this year and is set to complete in 2021.

ADFG has also recently been linked with the ministry of defence-owned Hyde Park Barracks in Knightsbridge, which is currently home to the Household Cavalry.

“The fall in sterling since the EU referendum undoubtedly creates attractive opportunities in the prime Central London real estate market for overseas investors. The London property market has long been an area of strategic focus for ADFG, and we continue to assess opportunities to complete high-quality deals which will enhance our premium real estate portfolio,” said the ADFG chief executive Jassim Alseddiqi.

He said that ADFG had noted a surge in interest for its No 1 Palace Street apartments in the months after the Brexit vote.

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