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Candy brothers in talks to sell Chelsea Barracks stake
Robert Mendick, Chief Reporter23.10.08
PROPERTY tycoons Nick and Christian Candy have been in negotiations over the sale of their stake in the £1billion Chelsea Barracks, the Evening Standard can reveal.
Discussions, which began in the summer, could see the Candys sell their share in the biggest housing deal in British history to their Qatari business partners. A deal could be concluded by as early as the spring.
The talks come as the credit crunch continues to take its toll on developers across London.
The Standard can also reveal:
● One third of the Candys' only completed development has still to be sold, including a £40million apartment.
● A huge development in Fitzrovia has stalled and will have to go back to planners to make it economically "viable".
● The Qataris are concerned their reputation has been damaged by the angry opposition to Chelsea Barracks.
Sources have told the Standard that the brothers, who have pioneered developments for the super-rich, are in negotiations to get their cash out of Chelsea Barracks which has been beset by planning rows, a revolt by wealthy local residents and claims that the brothers and their partners paid far too much for the 12.8-acre site.
Project Blue the joint venture set up between the Candy brothers and investment group Qatari Diar paid almost £1billion for the plot when it was sold by the Ministry of Defence last year at the height of the property boom.
A source s aid today: "No deal has been done so far but Nick and Christian want to get their money out. They will remain on the project overseeing the design and marketing of the scheme."
The Candys had pinned success on their ability to sell 320 private apartments for an average of £10 million each with a similar number of homes being provided as social housing, a Westminster council planning requirement.
Some property experts have suggested that, in the current climate, the developers would find it "difficult" to sell even one £10 million flat a month.
The Candys insist that would-be buyers are so rich they will be unaffected by the collapse of the mortgage lending system.
Today Nick Candy, 35, admitted that he and his 34-year-old brother had been in talks over the sale of their stake, thought to be worth between 20 and 30 per cent, but insisted negotiations had now ended with no sale agreed.
Mr Candy said: "There was a discussion about it but as we stand today it has been concluded. Nothing will change whatsoever on Chelsea Barracks."
But he added: "We are never looking to sell anything. However if Qatari Diar approached us and said they want to buy our equity, of course, we are friends with Qatar and I would do whatever they want me to do.
"I am not going to tell you nothing is going to change for ever and ever but up until we get planning, the agreement between Qatari Diar and CPC Group [the Candys' company] nothing will change."
The brothers, who live as tax exiles in Monaco, are building 80 apartments at One Hyde Park which has the financial backing of Qatar's prime minister Sheikh Hamad Bin Jassem Bin Jabor Al-Thani. Sheikh Hamad is also chairman of Qatari Diar.
One Hyde Park, overlooking Hyde Park, is understood to have sold well, with one apartment said to have fetched in excess of £100 million a world record.
But another development, Noho Square on the site of the old Middlesex Hospital in Fitzrovia, threatens to become bogged down in a legal dispute with Kaupthing bank, the Candys' Icelandic partners on the scheme.
The British arm of the bank has been put into administration by the Government.
The Candys are also in partnership with Kaupthing over another development in Beverly Hills, which has also stalled and the brothers have offered to buy out the bank from both joint ventures.
Some developers have dubbed the Fitzrovia development NoHope Square, amid suggestions it will remain a hole in the ground for some time.
Nick Candy admitted today that Noho Square was now behind schedule and that new plans for fewer homes and more commercial space may now be put to Westminster council. "We will definitely need to look at the viability of the present scheme," said Mr Candy. "We will look to reweight the plans towards commercial or hotels or some other use such as a private hospital."
There are also question marks over the Candy brothers' first major development Chesham Place, six apartments built on the site of an old telephone exchange in Belgravia. Land registry documents obtained by the Evening Standard show that two out of the six apartments are owned by Christian Candy and two companies, CPC No3 Ltd and CPC Grande Lateral GP Ltd, owned by the Candy brothers. The leases on the two properties were transferred on 3 March this year into Mr Candy and his two companies' ownership. The lender on the two flats is listed as Kaupthing.
Chesham Place's grandest apartment is on sale for £40million through Knight Frank.
Nick Candy insisted today that all six apartments had sold just that two of them had gone to his brother. "We bought them because we believe they are good long-term investments for the family," said Mr Candy.
The Chelsea Barracks development has prompted fierce local opposition. The Earl of Stockton, grandson of former Prime Minister Harold Macmillan, said the plan for 638 homes, a sports centre and hotel was an "abomination" and an "insult to the memories" of the soldiers who were housed at the barracks.
Sheikh Hamad, the brother of the Emir of Qatar, is, according to sources, said to be "embarrassed" by the adverse publicity and had hoped having the Candy brothers on board would have dampened opposition.
Qatari Diar has recently beefed up its London offices and is said to be taking greater control of the project which it hopes to steer through the planning process early next year. Further uncertainty has been caused by English Heritage's recommendation that a chapel on the site be granted listed status. If that happens, it will reduce the land available to build on.
Qatari Diar said today: "Candy & Candy Ltd is responsible for the interior space planning, interior design, development management as well as the marketing of the scheme [Chelsea Barracks]. Qatari Diar is pleased to confirm that this remains the situation and retains every confidence in CPC Group and Candy & Candy."
Reader views (7)
Well it would seems London is going to the Arabs! Watch out for sharia laws
- Maya T, Norfølk
About time too, the property speculators have had their day. The market over heated as long as two years ago with buy to let investors pushing property prices ever higher. The end of 125% mortgages and risky loans e.g 5 x salary and above will mean a return to negative equity not seen since the early 1990's. Boom Bust Boom ......
- Davy Boy, London
Most of the site has now been cleared perhaps Westfield could be made interested in a Riverside Shopping Centre?
- Melvyn Windebank, Canvey Island, Essex.
An investigation ought to be started into Candy's ability to obtain planning permission for buildings which are completely out of character in an area known for a restrictive planning regime.
- Ike, London
Woohoo! I have been waiting for these smug brothers to get a taste of reality. "Our customers are too rich to be affected", sanctimonious rubbish. It's people like this that have pushed property beyond the reach of even fairly wealthy people in London.
- Mark, London
I can't help but feel some schadenfreude over this fiasco. These two have been pandering to the super-rich and making a killing over the past few years, and at the same time they have demolishing grand landmarks such as the Middlesex Hospital only to propose what can only be described as eyesores.
I hope that this is the beginning of London being reclaimed for regular people rather than just being a playground for the super-rich.
- Roy, London
I am surprised that the Candy brothers get planning permissions for the ugly buildings they put up. Their development in Chesham Place looks like an upmarket prison and is totally out of chatacter with the surrounding properties.Knightsbridge will be ruined by their development and many people would prefer the nasty Bowater House. At least it was nasty with style.
- Paul, London UK
