Housing correspondent BARRATT HOLMES on how Criterion Capital have scooped a cut-price bargain on two landmark Croydon buildings, as they plan to deliver the country’s largest office-to-resi development
Going cheap: Apollo and Lunar House cost £99m when bought in 2015. This year, they’ve been sold on for just £30m
Croydon’s 1960s landmark buildings Apollo House and Lunar House have been sold for almost £70million less than a developer paid for them 10 years ago, in what is, even by Croydon standards, an eye-raising property deal.
And at the centre of this deal is Asif Aziz, the billionaire property developer described by The Times, no less, as “Britain’s meanest landlord”, who has been at the centre of controversies over Oxford Street gift shops and the cult Prince of Wales Cinema at Leicester Square.
Apollo House and Lunar House on Wellesley Road were bought for £99million in 2015 by Singaporean investor Ho Bee Land. For almost a decade, Ho Bee Land sat on their investment, quietly banking the regular rental payments from the Home Office, waiting their moment.
Once the civil servants who worked in the buildings moved to Ruskin Square, Ho Bee Land brought forward office-to-resi redevelopment plans to turn the buildings into nearly 600 flats.
But the Singaporeans have suddenly sold up for just £30million. They had only been granted planning consent in April this year.
Originally, Ho Bee Land were asking for £60million, but accepted less for a quick sale. A trade magazine euphemistically reported the purchase price as “tak[ing] advantage of price dislocation in the capital”.
Criterion Capital, the property business formed by Aziz, is moving into Croydon. It could be a bumpy ride.
Coming to Croydon: ‘Mr West End’, Asif Aziz, has also been called ‘Britain’s meanest landlord’
Criterion has a portfolio of prime real estate across London and the south-east reported as being worth about £6billion.
Aziz, now living as a tax exile in Abu Dhabi, did his first property deals when in his teens, converting storage space above a couple of shops in Deptford into flats. Tapping into the rapidly rising demand for residential accommodation, Aziz has made a fortune.
Aziz is sometimes called “Mr West End”, as his companies own vast chunks of the area around Piccadilly, including the Trocadero.
He has been criticised for using companies registered off-shore in the Isle of Man to buy properties in London, especially pubs, before closing them, usually to turn into flats. Aziz’s Criterion has also targeted other community buildings for redevelopment into “luxury apartments”.
There are no pubs at risk in the purchase of 22-storey Apollo and 20-storey Lunar House, the former immigration and visa centre at 36 and 40 Wellesley Road.
Using Permitted Development, or PD, planning rules, Criterion has already implemented the planning consent obtained by Ho Bee Land and will look to increase the number of flats across the site in what is thought to be the country’s largest office-to-resi development, eclipsing the 404-flat Delta Point scheme just up the road.
The Apollo and Lunar House homes could be worth £300million once completed.
Croydon Council approved two prior notifications for the scheme, so is unlikely to oppose the scheme brought forward provided criteria such as fire safety, contamination and transport impacts all check out.
Big profits: Apollo and Lunar House, built in the 1960s, could be turned into 600 flats
Apollo House and Lunar House comprised 441,797 sq ft of office accommodation, making up a large chunk of more than 1million sq ft of office space which is about to be lost in Croydon as PD is used to convert office blocks to residential.
The previous Labour council administration put a block on town centre PD schemes, with the flats in converted offices being described as “rabbit hutches” and “the slums of the future” by some councillors. It is reckoned that, in total, 1,500 residential units are being planned under PD rules for Croydon.
These include offices above the Whitgift Centre, whenever Westfield get round to submitting their planning application, and Mott Macdonald House, with plans for another 124 flats.
Read more: Planning consent granted for 580 flats in ‘space-age’ Croydon
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