Kevin Brass
A Qatari-backed partnership is the frontrunner to win one of the most prized redevelopment deals in London.
Royal Dutch Shell is expected to pick Canary Wharf Group along with Qatari Diar, the property investment arm of Qatar's sovereign wealth fund, to build office towers, retail space and apartments on the oil giant's 2.1-hectare headquarters site near Waterloo station in the British capital.
Canary Wharf Group is owned by Songbird Estates, a development company 27 per cent owned by the Qatar Investment Authority.
The Shell site is seen as a key part of redeveloping the area along the southern bank of the Thames, which is home to the London Eye Ferris wheel.
"[The site] has been waiting to be unlocked for a very long time," said Mat Oakley, the head of commercial research for Savills in London.
Shell has discussed redeveloping the area since 1997, but plans had stalled until last year when the company started actively seeking a development partner.
Shell has not yet named a redevelopment partner, but published reports and local property executives have pinpointed Canary Wharf Group and Qatari Diar as the likely choice. An announcement is expected within the next two weeks.
Little of the construction that has reshaped the London skyline in recent years has taken place in the area around the Shell building.
But the South Bank is attracting new attention, particularly with the construction of the Shard, the city's tallest building, which is funded by Qatari Diar.
With few new buildings available, the vacancy rate for office space in the South Bank area is 2.1 per cent, one of the lowest in the city, according to CB Richard Ellis.
"That area is relatively undeveloped with modern office space," Mr Oakley said.
The Shell project is one of several redevelopments schemes under way in the South Bank, in addition to the Shard.
This week, Sellar property group, the Shard's developer, announced plans to build a 17-storey office complex opposite the Shard. The list of South Bank projects also includes the mixed-use Elizabeth House redevelopment project, near the Shell headquarters, which calls for two buildings of 25 and nine storeys.
"Combined with Shell Centre, these two schemes will completely regenerate the [Waterloo] area," said Kevin McCauley, the director of Central London research for CB Richard Ellis.
Qatari interests own Harrods and helped to develop One Hyde Park, the Kensington complex touted as the most expensive apartment development in the city.
kbrass@thenational.ae
Mercer, the investment consulting arm of US services company Marsh & McLennan, expects its wealth division to at least double its assets under management (AUM) in the Middle East as wealth in the region continues to grow despite economic headwinds, a company official said.
Mercer Wealth, which globally has $160 billion in AUM, plans to boost its AUM in the region to $2-$3bn in the next 2-3 years from the present $1bn, said Yasir AbuShaban, a Dubai-based principal with Mercer Wealth.
“Within the next two to three years, we are looking at reaching $2 to $3 billion as a conservative estimate and we do see an opportunity to do so,” said Mr AbuShaban.
Mercer does not directly make investments, but allocates clients’ money they have discretion to, to professional asset managers. They also provide advice to clients.
“We have buying power. We can negotiate on their (client’s) behalf with asset managers to provide them lower fees than they otherwise would have to get on their own,” he added.
Mercer Wealth’s clients include sovereign wealth funds, family offices, and insurance companies among others.
From its office in Dubai, Mercer also looks after Africa, India and Turkey, where they also see opportunity for growth.
Wealth creation in Middle East and Africa (MEA) grew 8.5 per cent to $8.1 trillion last year from $7.5tn in 2015, higher than last year’s global average of 6 per cent and the second-highest growth in a region after Asia-Pacific which grew 9.9 per cent, according to consultancy Boston Consulting Group (BCG). In the region, where wealth grew just 1.9 per cent in 2015 compared with 2014, a pickup in oil prices has helped in wealth generation.
BCG is forecasting MEA wealth will rise to $12tn by 2021, growing at an annual average of 8 per cent.
Drivers of wealth generation in the region will be split evenly between new wealth creation and growth of performance of existing assets, according to BCG.
Another general trend in the region is clients’ looking for a comprehensive approach to investing, according to Mr AbuShaban.
“Institutional investors or some of the families are seeing a slowdown in the available capital they have to invest and in that sense they are looking at optimizing the way they manage their portfolios and making sure they are not investing haphazardly and different parts of their investment are working together,” said Mr AbuShaban.
Some clients also have a higher appetite for risk, given the low interest-rate environment that does not provide enough yield for some institutional investors. These clients are keen to invest in illiquid assets, such as private equity and infrastructure.
“What we have seen is a desire for higher returns in what has been a low-return environment specifically in various fixed income or bonds,” he said.
“In this environment, we have seen a de facto increase in the risk that clients are taking in things like illiquid investments, private equity investments, infrastructure and private debt, those kind of investments were higher illiquidity results in incrementally higher returns.”
The Abu Dhabi Investment Authority, one of the largest sovereign wealth funds, said in its 2016 report that has gradually increased its exposure in direct private equity and private credit transactions, mainly in Asian markets and especially in China and India. The authority’s private equity department focused on structured equities owing to “their defensive characteristics.”
Other must-tries
Tomato and walnut salad
A lesson in simple, seasonal eating. Wedges of tomato, chunks of cucumber, thinly sliced red onion, coriander or parsley leaves, and perhaps some fresh dill are drizzled with a crushed walnut and garlic dressing. Do consider yourself warned: if you eat this salad in Georgia during the summer months, the tomatoes will be so ripe and flavourful that every tomato you eat from that day forth will taste lacklustre in comparison.
Badrijani nigvzit
A delicious vegetarian snack or starter. It consists of thinly sliced, fried then cooled aubergine smothered with a thick and creamy walnut sauce and folded or rolled. Take note, even though it seems like you should be able to pick these morsels up with your hands, they’re not as durable as they look. A knife and fork is the way to go.
Pkhali
This healthy little dish (a nice antidote to the khachapuri) is usually made with steamed then chopped cabbage, spinach, beetroot or green beans, combined with walnuts, garlic and herbs to make a vegetable pâté or paste. The mix is then often formed into rounds, chilled in the fridge and topped with pomegranate seeds before being served.
The bio
Who inspires you?
I am in awe of the remarkable women in the Arab region, both big and small, pushing boundaries and becoming role models for generations. Emily Nasrallah was a writer, journalist, teacher and women’s rights activist
How do you relax?
Yoga relaxes me and helps me relieve tension, especially now when we’re practically chained to laptops and desks. I enjoy learning more about music and the history of famous music bands and genres.
What is favourite book?
The Perks of Being a Wallflower - I think I've read it more than 7 times
What is your favourite Arabic film?
Hala2 Lawen (Translation: Where Do We Go Now?) by Nadine Labaki
What is favourite English film?
Mamma Mia
Best piece of advice to someone looking for a career at Google?
If you’re interested in a career at Google, deep dive into the different career paths and pinpoint the space you want to join. When you know your space, you’re likely to identify the skills you need to develop.
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