The government has completed a deal to lease the historic Admiralty Arch building to Prime Investors Capital (PIC).
PIC is renovating the former office space into a 5 star hotel and residences. The building will remain in the ultimate control of taxpayers as the government has retained the freehold of the property.
The deal raises £65.5 million for the taxpayer. It was completed ahead of schedule following the satisfactory conclusion of the terms in the lease agreement. These terms included getting investment funding and planning permission from Westminster City Council.
Minister for the Cabinet Office, Matt Hancock said:
Between 2010 and 2015 the government raised £1.4 billion for taxpayers by getting out of property it no longer needed — helping to reduce the size of the government estate by the equivalent of 27 Buckingham Palaces.
But we’re determined to go even further, faster. Today marks a significant milestone in one of the largest and most exciting restoration projects in recent years. For too long, the Arch was an unsuitable and costly office space accessible only to those in government. Thanks to this deal, it will now be transformed into a landmark that the public can enjoy.
Rafael Serrano, Chief Executive of Prime Investors Capital (PIC) said:
We are delighted to have made remarkable progress, with full planning consent and completion of the lease sooner than anticipated for Admiralty Arch. Through our strong relationship and on-going collaborative efforts with the government, Westminster City Council, English Heritage & Historic England, The Royal Parks, and other local stakeholders and neighbours, we look forward to completing the restoration as anticipated and bringing the building to life by delivering the very finest hotel, private residences and private members’ club for London.
The Cabinet Office has worked closely with PIC, Westminster City Council and Historic England to ensure the building is restored to its former glory. Following a bidding process, the building lease was sold to PIC in October 2012 subject to certain conditions to be satisfied within 3 years. Since then, PIC worked with its team of 20 British experts to develop a strategy to preserve and celebrate Admiralty Arch’s rich history.
History of Admiralty Arch
Originally designed as a ceremonial passage from Trafalgar Square towards Buckingham Palace, Admiralty Arch is a London landmark with historical and architectural significance. It housed offices and residences for the Sea Lords of the Admiralty and was used by the Navy and the Ministry of Defence until 1994.
The Grade I listed building has been empty for a number of years and is not suitable for a modern office. PIC plans to renovate the building sensitively, in keeping with architect Sir Aston Webb’s original drawings from around 1910, restoring many lost designs.
Rationalising government buildings
The deal forms part of the government’s plan to rationalise its estate to make it more efficient and encourage economic growth. Between 2010 and 2015 the government generated a cumulative £1.4 billion for taxpayers through property reforms, including by exiting 2,018 buildings, equivalent to one every day.
In the 2015 Budget the government announced plans to create a new central body or bodies to manage relevant property and land assets. A new commercially-driven approach would ensure that departments pay market-level rents for the freehold assets they own. This will help improve management of the estate and contribute to plans to save up to £6 billion more by disposing of surplus land and buildings.