Goldman Sachs to syndicate £160m Canary Wharf loan

Goldman Sachs is seeking to syndicate a £160 million loan it made to Hong Kong investor HNA Investment Holding.

The loan financed HNA’s recent acquisition of the Thomson Reuters headquarters building at Canary Wharf in London.

HNA, the parent company of Hainan Airlines, bought the 305,000 square foot building at 30 South Colonnade last September for about £215 million from German fund manager KanAm.

Goldman’s debt facility is believed to be at a loan to value of about 75 percent putting the debt quantum at about £160 million. The investment bank is exploring syndicating both senior and mezzanine tranches.

The Thomson Reuters building was HNA’s first real estate acquisition in Europe. At the time the Chinese group said the acquisition was “an important step for building (a) European portfolio.”

It has since been linked to the acquisition of a second Canary Wharf building, 17 Columbus Courtyard, a 200,000 square foot building let to Credit Suisse and put up for sale by Vico Capital.

HNA has also been buying in New York, picking up a 614,000 sq foot office building at 850 Third Ave in Midtown Manhattan in partnership with MHP Real Estate Services when it was sold last month by Shorenstein Properties.

The Thomson Reuters investment is complicated because the income is short term. The tenant is moving to a different building on the Canary Wharf estate before its lease on 30 South Colonnade expires in 2020. It has signed an agreement to sublease 350 000 square feet from down-sizing investment bank Credit Suisse at 5 Canada Square. Credit Suisse would also be HNA’s tenant at 17 Columbus Courtyard. Credit Suisse pays about £40 per square foot.

Although there is a short rental guarantee beyond 2020 on 30 South Colonnade, HNA will be in competition with Canary Wharf’s owners in any future development or refurbishment of the space.