A London office project that included plans for a 1.4 acre urban rooftop forest has been placed under receivership after defaulting on a loan from the billionaire Reuben Brothers.
A receiver has been appointed to the company behind Roots in the Sky, the proposed redevelopment of Blackfriars Crown Court in London’s Southwark district, according to a filing. A company controlled by Fabrix Capital acquired the property in February 2020 and planned to redevelop it into a 430,000 square feet (39,948 square meters) office.
Rising interest rates have roiled commercial real estate, crimping valuations and pushing up landlords’ relative indebtedness, causing some to default. It has been particularly brutal for developers who have also had to contend with soaring construction costs and uncertainty over future demand.
Fabrix acquired the site just before Britain’s first coronavirus lockdown, a time when competition for projects was fierce. The company paid over £64 million ($78 million) for the vacant buildings, filings show. The properties were originally put up for sale by HM Courts and Tribunals Service for £45 million, EG reported in March 2019.
Fabrix is working with Motcomb Estates, a property company owned by the Reuben Brothers, to find a solution for the project, according to people with knowledge of the discussions, who asked not to be identified discussing internal matters.
Options being considered include bringing in a new partner to help fund the construction, they said.
Representatives for Fabrix and Reuben Brothers declined to comment.
Billionaire British brothers David and Simon Reuben own swathes of trophy London properties in the city’s Mayfair district but they are also active lenders to other real estate investors. Last year they took control of the Admiralty Arch hotel development, having originally stepped in to provide
finance for the previous developer.
Fabrix’s plans for the project, which was slated to feature a swimming pool, included using recycled steel to help reduce its carbon footprint.
