(June 30): Barclays Plc has acquired its global headquarters in London’s Canary Wharf for £750 million (US$993 million or $1.2 billion).
The British lender purchased the building from Canary Wharf Group Plc in a 999-year lease deal, according to a statement Tuesday. The one-million-square-feet workplace at One Churchill Place has been Barclays’ global headquarters since 2005, and its current lease was due to expire in 2039.
“This acquisition gives us long-term certainty, greater flexibility over our London footprint and reinforces our continued confidence in London as one of the world’s leading global financial centres,” CS Venkatakrishnan, Barclays’ chief executive officer, said in the statement.
The deal is expected to be broadly neutral to Barclays’ earnings and Common Equity Tier 1 ratio, a measure of financial strength, the bank said in the statement.
Barclays’ decision to buy, rather than rent, its Canary Wharf headquarters is the latest move among global banks opting to own their buildings in London. Changes to lease accounting rules now require companies to recognise the full liability of long term rental obligations on their balance sheets, encouraging some companies to buy instead.
Citigroup Inc bought its London headquarters at 25 Canada Square about seven years ago and is in the process of refurbishing that building. Late last year, JPMorgan Chase & Co unveiled plans to build what will be the UK capital’s largest office in the city’s east financial hub. That facility will span about three million square feet of gross area and host as many as 12,000 employees.
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