SOUTH BANK DEVELOPMENT

SOUTH BANK DEVELOPMENT

: Enhanced Brand Value

A new ITV for the New London.

South Bank Development is their partner for primetime.
Redevelopment of the site. Redevelopment of the brand.
Embracing Real Estate Opportunity

Re-establish HQ on Londons South Bank amongst contemporary iconic

developments
Destination for National fan base of their globally renowned TV shows
Reconnect with the immediate community
Mix of uses more welcoming for their industry clients
Modernize HQ and studio operations
Streamline operations to improve company revenue

Increasing Brand Value through Enhancement of Real Estate

New iconic ITV HQ connecting to resurgent South Bank RE

Opening Property to Thames Riverfront Promenade; increasing view
corridors
Interior central plaza welcomes neighborhood & London area tourists
Interactive Multimedia Museum & Experience Centre
Open viewing studio provides the public and fans unique experience to
enjoy ITV programming
Educational opportunities for the area students and families
Mixed-Use Development creates dynamic & social property
Image Buzz that resonates with the new Technology, Media and
Telecommunications sector taking shape in South Bank
Hotel provides ITV industry professionals convenient & indulging
experience while working on their ITV production
Upgraded, consolidated & environmentally sustainable new HQ will
provide accretive expense savings for ITV

SOUTH BANK DEVELOPMENT

Acquisition & Development Strategy

Acquire Free Hold Interest of London Television Centre

Proposed Acquisition Price of 50,000,000 (net of 150,000 SF of Studio Space); Providing ITV with a

ITVCentre
SourcesandUsesofFunds

return of ~15%. Cost: 56 + 6.5 = 62,500,000; Value of Studio: 20/year NNN x 150,000 = 3,000,000
/ 8% = 37,500,000; Discount on Value: 50% x = 37,500,000 = 18,750,000; Acquisition - Value of
Studio = 43,750,000. Purchase Price = 43,750,000 x 1.15 (Owner Profit) = ~ 50,000,000

Demolish Existing Infrastructure

Construct Dynamic Mixed Use Development

Balanced Mix of Programs: Office, Condominium, Hotel, Retail & Parking

Develop Iconic ITV Headquarters for Studio & Office Space

Participate in the Revitalization of SE1

SouthBankDevelopment

Rebranding of iTV
Iconic Headquarters for
Studio and Office
Space
Cohesive development
for employees & clients
Improve Local & Global
Presence

Opportunistic
development opportunity
Levered IRR of ____+
Positive NPV
Contribute to
repositioning of SE1

865,239GSF
146,598GSF
1,011,837GSF

Amount
SOURCESOFFUNDS
DeveloperSponsorEquity
ThirdPartyInvestorEquity
SeniorLoan
PropertyCashFlow
TotalSourcesofFunds

$22,848,231
$205,634,079
$136,692,064
$997,480
$366,171,853
Amount

ALIGNMENTOFALLPARTIESINTERESTS
ITV

AboveGradeGSF
BelowGradeGSF
TotalProjectGSF

CityofLondon

MarketDemand

Revitalization of SE1
Increased Tax Base
Affordable Housing
Job Creation

ITVCENTRE

Strong demand for office,

hotel & condominium real
estate
Shortage of Class A office
supply, boutique hospitality
& luxury residential
Demand for revitalization of
SE1
Successful development of
The Chard supports market
demand

LONDONEYE

USESOFFUNDS
LandandAcquisitionCosts
Demolition
HardCosts
SoftCosts
VATTax
DeveloperContingency
FinancingCosts
OperatingDeficit
TotalUsesofFunds

$54,500,000
$1,000,000
$222,647,807
$33,397,171
$51,408,996
$1,000,000
$2,071,092
$82,719
$366,107,784

THESHARD

$/Unit

6.24%
56.16%
37.33%
0.27%
100.00%

$23
$203
$135
$1
$362

$/Unit

14.89%
0.27%
60.81%
9.12%
14.04%
0.27%
0.57%
0.02%
100.00%

$54
$1
$220
$33
$51
$1
$2
$0
$362

$/GSF*
$22.58
$237.66
$157.98
$1.15
$423.20
$/GSF*
$62.99
$1.16
$257.33
$38.60
$59.42
$1.16
$2.39
$0.10
$423.13

BIGBEN

SOUTH BANK DEVELOPMENT

Programming
GSF
339,000

%
34%

165,748

16%

39,967

4%

Condominium
MarketRateUnits 33
AffordableUnits 36

175,280

17%

Hotel 151Keys

145,244

14%

Parking

146,598

14%

1,011,837

100%

Office
ITVOfficeSpace
SpecOfficeSpace

200,000
139,000

283meters(869ft.)

137meters(450ft.)

195meters(639ft.)

ITVStudio
Retail
ITVExperienceCentre
HotelRestaurant
StreetFrontRetail

15,291
21,258
3,418

14%
34%

A landmark headquarters supported by a mixed program that benefits

stakeholder interests and a resurgent community

14%

17%
4%

16%

SOUTH BANK DEVELOPMENT

Office & Studios

Office

200,000 GSF - ITV Office Space, Floors 10 - 35

139,000 GSF - lettable office space, Floors 36 - 49
Creative hub designed for media & technology firms
Spectacular 360 views of London
75% of Fortune 500 Companies have a London Office
Strong Overseas Investment in office real estate

Source: Jones Lang LaSalle

Office prime rents jumped in 2013, The Shard rents between 55 and 60 psf

CBRE reported top lets for South Bank as of Q4 2013 at 47.50 psf

Savills World Research reported top rents YTD in SE1 at 55 psf

Per PPR, South Bank is on course for strongest letting year since 2007

ITV Studios

150,000 GSF - ITV Studio Space, Ground 9th Floor

State of the art ITV Custom Studio Design
Column free production spaces with 12 meter ceiling heights
Iconic Cantilevered Studio showcasing ITV Brand
ITV Freehold Interest
Adjacency to ITV Office Space
Convenient loading dock access

SOUTH BANK DEVELOPMENT

Hotel & Condominium

Hotel

Luxury full service flagged hotel with 151 keys

Positioned for tourists, ITV employees & clients
Irreplaceable rooftop bar and pool with panoramic views
Strong local occupancy at 85%; Strong ADR at 114.47
Potential boutique flag partners: Thompson, Ace, Standard etc.

Source: Smith Travel Research/ STR Global, Inc. Trend Report (South Central London

Luxury Condominiums

82 Luxury Condominium Units

39 - Affordable 1,000 SF Units, 17 - 1 BR 1,500 SF Units, 16
2BR 2,000 SF Units & 10 3BR 3,000 SF Units
Luxury Fitness & Media Centre
Distinctive Balcony(s) for each unit
Dedicated Marketing Website capturing Sales Strategy
Average Asking Price per Square Foot of 1,524

ResidentialCompSummary
No.
1
2
3
4
5
6
7
8

PropertyNameorAddress
AlbertBridgeHouse
AlbionRiverside
PeninsulaHeights
SpiceQuayHeights
NEOBankside
9AlbertEmbankment
OneBlackfriars
OneBlackfriars

Postal
Distanceto
Code Subject(meters)
SW11
4787
SW11
4996
SE1
2128
SE1
2390
SE1
709
SE1
2039
SE1
382
SE1
382

AskingPrice
1,980,000
1,595,000
2,450,000
1,900,000
5,750,000
2,995,000
1,850,000
2,900,000

PricePer
SquareFootage Bedrooms/Bath SquareFoot
ListingFirm
1377
2Bed 2Bath
1,438
KnightFrank
1,442
2Bed 2Bath
1,106
KnightFrank
2,174
2bed 3Bath
1,127
KnightFrank
1,185
2Bed 3Bath
1,603
Hurford,Salvi,Carr
2,095
KnightFrank
2744
3Bed 2Bath
1,687
3Bed 3Bath
1,775
KnightFrank
NA
2Bed 2Bath
NA
Colliers
NA
3Bed 3Bath
NA
Colliers
Average
1,524

SOUTH BANK DEVELOPMENT

Retail & Parking

Retail

39,967 GSF of prime retail at the centre of a lively mixed-use community

Highly visible ITV Experience Museum & Store -15,291 GSF
Ground floor caf and pub space on the Riverwalk 3,418 GSF
Destination sky restaurant and bar at 137 meters - 21,258 GSF
Restaurant activation of Neighborhood connection with Riverfront
Promenade
Strong exit cap rates of 5.0% reported by CBRE & JLL

Retail/RestaurantCompSummary
No.
1
3
4
5
6
7
9

PropertyAddress
2GantonStreet
3840LudgateHill
103107Waterloo
128King'sRoad
181King'sRoad
OxoTower
125WoodStreet

PricePerSquare
PostalCode AskingRent
SquareFootage Foot
ListijngFirm
W1
45,000
644
70 Cushman&Wakefield
EC4
200,000
1,520
132 CBRE
SE1
150,000
1,250
120 Savills
SW3
185,000
2,232
83 Savills
SW3
500,000
7,181
70 Savills
SE1
11,289
355
32 Savills
EC2
72,500
660
110 Savills
Average
88

Parking

Newly Constructed Below Grade Parking

ITV Office Parking Spaces: 100
Market Office Parking Spaces: 2
Condominium Parking Spaces: 56
Hotel Parking Spaces: 19
Retail Parking Spaces: 4
Strong Rental: Per CBRE Global Office Occupiers Guide 2011 Asking 4,000 / month
Sales Revenue: One Blackfriars Asking 75,000

SOUTH BANK DEVELOPMENT

A Diverse Submarket & Strong Access to Subject

ARenownedCreativeArtsDistrictwithaBurgeoningTechnology,MediaandTelecommunicationsIndustry

33

28
21

25

15

14

26
34

3
41

29

22
23

42
41

16

43

27
2

12

13

30

4
6
7

35
38

39
17

20

18

10

36

19
37

32

40
31

24

11

10

44
45

10
1 ITV CENTRE (PROJECT SITE)

Cultural
MixedUseDevelopments:
2 ShellCentre
3 OxoTowerWharf

Landmark:
4 LondonEye
5 TowerBridge
6 BigBen
7 PalaceofWestminster
8 TrafalgarSquare
9 St.PaulsChurch
10 TowerofLondon
11 CityHall

12 TateModern
13 ShakespearesGlobeTheatre
14 RoyalNationalTheatre
15 QueenElizabethHall
16 RoyalFestivalHall
17 FlorenceNightingaleMuseum
18 TheOldVic
19 YoungVic

Transport:
20 WaterlooTrainStation
21 WaterlooBridge
22 BlackfriarsBridge
23 MillenniumBridge
24 LondonBridgeUndergroundTrainStation

Park
25 RiversideWalkwayandOpenSpaces
26 BernieSpainGardens
27 St.JamesPark
28 VictoriaEmbankmentGardens

Office:
29 SeaContainersHouse
30 BlueFinBuilding
31 TheShard
32 ThePlace
33 TheGherkin

Retail/Entertainment:
34 GabrielsWharf
35 SeaLifeLondonAquarium
36 LondonDungeon
37 BoroughMarket

10

Hotel:
31 ShangriLa(InsideThe
Shard)
38 LondonMarriottHotel
CountyHall
39 ParkPlazaCountyHall
40 ParkPlazaWestminster
Bridge

Residential(Luxury):
41 SouthBankTower
42 OneBlackfriars
43 NEOBankside
44 TowerBridge
45 SpiceQuayHeights

SOUTH BANK DEVELOPMENT

2015

2016

10 Year Holding Period Ensures Successful Completion &

Stabilization
2017

2018

2019

2020

2021

2022

2023

2024

2025

2026

Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4 Q1 Q2 Q3 Q4

Offer, Negotiation & Due Diligence

Ownership Entity Creation
Design & Permiting
Construction Loan Funding
ITV Property Occupancy
ITV Relocation to Temporary Site
ITV Return to Site
Additional Property Leasehold Creation
Pre-Construction Period
Demolition Period
Construction Period
Condo Sales
Leaseup
Stabilization
Disposition

SOUTH BANK DEVELOPMENT

Key Underwriting Assumptions

Office

Net Rentable Area:

Total Cost:
Rental Rate ITV:
General Vacancy Rate:
Market Rental Rate:
TIs:
Cap Ex
Exit Cap Rate:

Retail
305,100 SF
87,716,250
45.00/PSF
5.0%
60.00/PSF
4.00/PSF
$0.25/PSF
5.00%

Net Sellable Area:

Total Cost:
Affordable Price per Square Foot:
1 BR Price per Square Foot:
2BR Price per Square Foot:
3BR Price per Square Foot:
Sales Commissions %:
Sales & Marketing Expense:

131,724 SF
211,746,321
400/PSF
1,500/PSF
1,500/PSF
1,800/PSF
1.75%
2.00%

Parking

Total Space:
Average Space Size:
Total Cost:
Office Rental Rate:
Hotel Rental Rates:
Condo Salable Spaces:
Office Rental Rate:
Retail Rental Rate:
Operating Expense Ratio:

Net Rentable Area:

Total Cost:
ITV Experience Centre Rental Rate:
Market Average Rental Rate:
General Vacancy Rate:
Exit Cap Rate:

36,562 SF
8,992,575
45.00/PSF
80.00/PSF
5.0%
5.0%

Hotel

Condominium

202 Spaces
400 SF
6,980,250
4,000/YR
5,000/YR
75,000/Space
4,000/YR
4,000/YR
35.00%

Net Rentable Area:

No. of Keys:
Average Room Size:
Total Cost:
Average Daily Rate (ADR):
Occupancy Rate:
Operating Expense Ratio:
Exit Cap Rate:

66,979 SF
181
620 SF
43,427,956
132
86.0%
24.0% of Total Revenue
5.5%

SOUTH BANK DEVELOPMENT

Joint Venture Structure

Partnership Structure

Total Required Equity (Purchase + Operation)

228,482,310

Sponsor/Developer

10%

22,848,231

Third Party Investor

90%
100%

205,634,079
228,482,310

(Includes Operating Deficit Funding)

Profit Sharing
Waterfall #1
Partnership Structure
Sponsor/Developer Equity
Investor
Total

Preferred Return
% Total Equity
10%
90%
100%

8%
GP Equity
LP Equity

Residual Split
10%
20%
90%
80%
100%
100%

Sponsor
Promote
10%

SOUTH BANK DEVELOPMENT

Equity Waterfall Structure

EquityWaterfallSchedule
AnnualReturn
TotalInvestmentAmount
SponsorPromote

8.00%
228,482,310
10%

AnnuallyCompoundingPreferredReturn
EquityInvestment
SponsorPortion
InvestorPortion

Total
(228,482,310) (74,718,622)
10% (22,848,231) (7,471,862)
90% (205,634,079) (67,246,760)

LeveredCashFlow
InvestorCapitalAccount

Total

CapitalInvested
InterestonInvestedCapital
PaymentofInterestEarned
RepaymentofInvestedCapital

67,246,760
75,652,053
(75,323,938)
(67,246,760)

InvestedCapitalBalance
InterestAccountBalance

EndingBal.

328,114

SponsorCapitalAccount

Total

CapitalInvested
InterestonInvestedCapital
PaymentofInterestEarned
RepaymentofInvestedCapital

7,471,862
8,405,784
(8,405,784)
(7,471,862)

InvestedCapitalBalance
InterestAccountBalance

EndingBal.

ResidualCashFlowForDistribution

587,668,776

Tier1

8%

InvestorCashFlow
SponsorEquityCashFlow
SponsorPromoteCashFlow

Total

80% 470,135,021
10% 58,766,878
10% 58,766,878

RemainingCashtoDistribute

LPIRR:

TotalLPInvestorCashFlow
GPIRR:
TotalGPSponsorCashFlow

1 2 3 4 5 6 7 8 9 10
1Jan15
1Jan16
1Jan17
1Jan18
1Jan19
1Jan20
1Jan21
1Jan22
1Jan23
1Jan24

11.04%
431,069,526
22.12%
113,156,688

(96,903,083)
(9,690,308)
(87,212,775)

(71,198,586)

(39,467,892)
(3,946,789)
(35,521,103)

(24,473,602)

(92,111,334)
(9,211,133)
(82,900,201)

(86,439,620)

4,284,083

142,818,313
14,281,831
128,536,481

7,393,645

10,945,375
1,094,538
9,850,838

98,987,797

1,017,000

1,017,000

1,017,000

847,500

87,212,775
4,965,202

836,658,037
27,229,409

35,521,103
8,649,964

1,275,965,914
112,613,458

82,900,201
13,766,724
(321,306)

1,991,459,827
244,559,377

18,476,163
(3,855,675)

2,467,608,944
418,642,891

(128,536,481)
14,015,271
(6,654,280)

1,480,224,401
576,903,676

(9,850,838)
4,840,813
(52,881,170)
(36,207,848)

547,687,361
110,590,163

2,530,155
(915,300)

372,466,945
22,393,618

2,659,343
(915,300)

372,466,945
42,601,727

2,798,867
(915,300)

372,466,945
64,426,484

2,446,996
(762,750)

310,389,121
71,615,942

9,690,308
551,689

92,962,004
3,025,490

3,946,789
961,107

141,773,990
12,512,606

9,211,133
1,529,636
(35,701)

221,273,314
27,173,264

(0)

2,052,907
(428,408)

274,178,772
46,515,877

(0)

(14,281,831)
1,557,252
(739,364)

164,469,378
64,100,408

(0)

(1,094,538)
537,868
(5,916,205)
(3,982,574)

63,083,231
10,058,716

(0)

281,128
(101,700)

41,871,453
2,001,943

295,483
(101,700)

41,871,453
4,247,288

310,985
(101,700)

41,871,453
6,672,261

271,888
(84,750)

34,892,877
7,552,129

(35,521,103)

(3,946,789)

(0)
(0)
(0)

(83,221,507)

(9,246,834)

(0)
(0)
(0)

(3,855,675)

(428,408)

(0)
(0)
(0)

121,882,201

13,542,467

(0)
(0)
(0)

(79,238,180)

(8,804,242)

(915,300)

(101,700)

(915,300)

(101,700)

(915,300)

(101,700)

(762,750)

(84,750)

(87,212,775)

(9,690,308)

SOUTH BANK DEVELOPMENT

Design Strategy : Composition

Varied faade treatment reflects each program setting

Showcase cantilevered studio: Londons sightline into the new look of ITV
Diverse array of condominium terraces: A distinctive setting for every residence
Setbacks and voids generate an open air composition at both ground and
elevated levels

SOUTH BANK DEVELOPMENT

Positioning of towers preserves views of St. Pauls

Cathedral from Westminster Pier
Dynamic central plaza unites the street and the River walk
Matchless design enlivens the south bank riverfront

Design Strategy : Maintaining View Corridor

SOUTH BANK DEVELOPMENT

Environmentally Sustainable

Continually striving for the highest environmental standards and

sustainable practices, South Bank, will work with BREEAM at the preconstruction phase through finishing to attain the highest certification, 5Star Outstanding Status, for New Construction Office, Multi-Residential
and Retail
Ecology
OnSiteRenewableEnergy
Energy
Efficiency

HealthandWellbeing
WaterConsumption

Waste
LandUse

Transport
Materials

Electricvehiclechargingstationsformovethathalfoftheproject'sparkingstalls

Management
Pollution

South Bank, to maintain peak sustainable operations will seek the highest
rating A for the Domestic and Non-Domestic Energy Performance
Certificate from the Energy Performance Assessor

BarclaysCycleHireStationswillbelocatedontheriverfrontandstreetfront

Flood Risk Management

Sustainability Plan Additionally Achieves the Following:

1.
Adherence to Lambeth Local Development Framework social
and green infrastructure development
2.
Provides the client and partner with an environmentally
beneficial headquarters to live and work
3.
Preserves long term operational rewards through the expense
savings realized in sustainable construction and management

Project site falls within Flood Zone 3a

Projected by flood defenses and the Thames Barrier
South Bank will work with council and the environmental
agency to manage and mitigate ongoing flood risk
Planning application will be submitted with a completed flood
risk assessment
Strict compliance with the exception test in national policy and
London plan policy
Though site development is outside of 16 meter tidal flood
defense, measures to mitigate flooding from ground water and
sewers shall be incorporated into construction