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Canary Wharf Group will receive a £118mn loan from a government housing infrastructure fund to support developing a life-sciences centre, a healthcare diagnostic facility and several hundred new homes.
Chancellor Jeremy Hunt flagged the funding in Wednesday’s Budget, promising £242mn, as he pledged to help build a total of 8,000 homes in east London and to “[transform] Canary Wharf into a new hub for life-science companies”.
The funding will be divided into £124mn to “unlock” 7,200 homes at Barking Riverside, a major housing development further down the Thames, and investment in Canary Wharf, which will support up to 750 homes.
The Treasury confirmed the £118mn for Canary Wharf, which will also help fund retail and commercial development, would be in the form of a loan to the developer Canary Wharf Group — owned by asset manager Brookfield, which manages more than $900mn, and the Qatar Investment Authority, the sovereign wealth fund.
The chancellor announced the cash boost to provide more housing and infrastructure in London, as he pledged “to level up opportunity across the generations — including building more houses for young people”.
The loan will come from the Home Building Fund – Infrastructure Loans fund, the Treasury said. According to the programme’s criteria, the money is intended to “unlock strategic housing sites”.
“[The] infrastructure funding can provide the financing for any non-housebuilding activity needed to unlock large sites and enable partners to use their capital resources to deliver housing quickly,” the document said.
Liz Saville Roberts, a Plaid Cymru MP, criticised the decision on social media platform X. “Westminster’s priorities are clear for all to see,” she said.
Loans from the fund are typically extended for up to 20 years, secured against property assets and carrying a “commercial” interest rate. The Treasury did not specify the terms of this particular loan.
Canary Wharf Group has been pushing to diversify the estate from its traditional focus on financial services offices by adding residential buildings, shopping and restaurants. The company has also been working to expand its appeal to life-science companies by offering facilities like lab space.
The estate already houses a number of organisations in the sector, including Genomics England, Barts Health NHS Trust and the General Pharmaceutical Council. Last year, it secured planning permission for a 23-storey commercial health and life-sciences tower on its North Quay site.
More than 3,500 people already live in the area, according to CWG, and there are more than 1,000 rental flats there.
Brookfield and QIA in October announced a £300mn equity infusion and a £100mn revolving credit facility for Canary Wharf Group. The district has lost some key tenants, including HSBC, which has said it will move to the City. Other financial groups, like Barclays, have decided to stay.
Canary Wharf Group declined to comment.
