London's Canary Wharf property values stabilise after pandemic slump

LONDON (Reuters) - Property values in London's Canary Wharf financial district were roughly stable at about 6.8 billion pounds ($9 billion) last year, after declining by 15% in 2023 after the pandemic drove down office prices.

The east London district is trying to revive its fortunes by diversifying its tenant mix with more homes, hotels and restaurants, while some of its biggest tenants, including HSBC have announced plans to leave for the more central City of London.

Canary Wharf Group - which is joint owned by investors Brookfield and the Qatar Investment Authority - said in its 2024 results that its property portfolio was worth 6.75 billion pounds, a 1% dip on 6.83 billion pounds in 2023.

The group struck a financing deal in December to borrow 610 million pounds from U.S. investment giant Apollo to repay bonds due over two years, raising its funding costs but removing near-term refinancing risks.

Office vacancies in the wider Docklands area have hit a record high, according to CoStar data, and could rise to 30% in the coming years if the area cannot find tenants to fill 2 million square feet (185,806 square meters) of space becoming vacant.

There have been tentative signs of recovery, however, as companies have demanded staff spend more time in offices after many worked from home full-time during the pandemic.

($1 = 0.7553 pounds)

(Reporting by Iain Withers; editing by Barbara Lewis)