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West End landlord Shaftesbury today tapped the City for almost £150 million to fund a regeneration project in the heart of Soho.
The firm launched a rights issue so it can buy buildings in Berwick Street and create a new and vibrant "village" such as those it already owns in Carnaby Street, Chinatown and Covent Garden.
It could change the face of Berwick Street, famed for the Berwick Street Market, a host of ailing record stores, and its brothels. Soho has been undergoing a transformation in the past decade as developers including the Paul Raymond property empire invest in bringing the area more upmarket.
Shaftesbury has bought 18 properties on the street worth £27.7 million in recent months and plans to add to its holding in the coming years.
"We are very excited about the potential for Berwick Street," said chief executive Jonathan Lane. "Berwick Street is in the heart of London's iconic Soho district and Shaftesbury has been looking at this area for some years.
"Current ownership is fragmented, the pavements are in a bad way and buildings are under-utilised. The street and surroundings would benefit from some care and attention and the cultural fit with our existing portfolio is excellent."
Parts of the street are run down, and Shaftesbury hopes to attract new cafés, bars and restaurants as well as trendy boutique fashion stores and independent shopkeepers.
It hopes to capture some of the buzz found elsewhere on its estate and on nearby Wardour Street although it admits it will take time.
The rights issue, which is fully underwritten and allows current shareholders to buy two shares at 175p each for every three they already own, will raise £149.1 million.
The shares, which crashed from around 550p a year ago to 240p in March, were today up 143⁄4p to 388p today.Shaftesbury today posted losses of £159.8 million in the half year to March against losses of £93.6 million in the same period last year.
The firm was hit by the collapse in property values although its estate lost far less than many of its rivals due to its focus on popular areas of the West End.
The portfolio was worth £1.1 billion at the end of March, down 10% or £123.5 million over the six months.
Reader views (1)
Oh Christ, another Covent Garden or Carnaby Street? What a nightmare for Soho.As for attracting "new bars and cafes " read Starbucks and All Bar One. Will this homogenisation of Soho never end? Where will people buy their records? What will happen to the prostitutes? It's a disgrace and I hope it never happens. If people want identikit towns why not stay in Croydon or Hammersmith? Leave Soho alone.
- Miles, London, England
