Developer will return £110m proceeds to shareholders

Facebook’s new European HQ has been sold by its developer Great Portland Estates to German property giant Deka.

The central London development specialist has secured £435m for the Make-designed West End project - which is being built by Lendlease - meaning that it will net a £110m profit.

GPE told investors about the sale of the freehold on the Rathbone Square development last Friday.

This sum will be returned to shareholders in the form of a special dividend rather than being pumped into financing new development schemes. In a statement to the stock exchange, GPE said the sale would enable the company to retain “significant financial flexibility” in a “continued period of market uncertainty”.

More than half of the 419,700 sq. ft. mixed used development consists of 242,800 sq. ft. of office space, which was pre-let to Facebook in 2015 on a 15 year lease at an annual rent of £17.8m.

Just over half of the scheme’s 25,200 sq. ft of retail space is under offer and 139 of the 142 private flats have been sold.

Including ground rents on the private apartments, the entire development is expected to generate £19.7m worth of rents once it is fully let.

Commenting on the disposal, GPE development director James Pallett said the company had more than sufficient capital to complete its development pipeline.

“As we head towards the end of the committed pipeline we have surplus capital and as a result thought it was better placed in our shareholders bank than our own.

“We have a very low gearing and plenty of cash on hand to still complete our existing commitments.”

Construction work on Rathbone Square, which is being built on the site of a former Royal Mail sorting office on Tottenham Court Road, commenced in 2014,