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LONDON-Hines and Network Rail have landed construction financing for development project here that entails renovating the London Underground station and topping it with a 400,000-sf office building. Construction is slated to begin this summer and completion is expected in early 2010.

The project calls for approximately 400,000 sf of office space and 17,000 sf of station retail space. The office space will be in an eight-story office building with 49,000-sf floor plates. The retail space will be on both the concourse, and underground levels of the rail station. A renovation of the Cannon Street station concourse is also included in the cost of the project.

Hines is as yet providing little additional detail with regard to the project or the financing, which is being funded by HSH Nordbank, and an HSH executive could not be reached Friday for comment. The London Underground station is one of London's principal transportation interchanges and the area in and around the station is slated for substantial redevelopment."The City of London represents one of the key markets for office real estate, which will continue to be marked by keen long-term demand among corporate tenants and international real estate investors," says Jurgen Lange, head of international real estate for HSH, in a prepared statement. Adds Hines UK managing director Stephen Musgrave, "This is a really exciting building in an area of the city that is about to undergo a major transformation."

Hines purchased a long-term leasehold on 78 Cannon St. in 2002. The existing office building on the site contains approximately 140,000 sf net rentable. Hines received approvals for the redevelopment project in 2005. During the approval process, a point of dispute was Hines' request for 32 parking spaces.

In contrast to the US, where even in CBD office developments parking for cars far exceeds the parking for bicyclists, the rules for urban office projects in London is exactly the opposite. The city's rules require that a development contain no more than one parking space per 16,000 sf of building area and no less than one bicycle parking spot per 1,345 sf of building area. For Cannon Place, that means no more than 23 parking spots for cars and no less than 290 parking spots for bicycles.

Hines is a privately owned real estate firm involved in real estate investment, development and property management. One of its recent projects in London was the redevelopment of the former Salvation Army HQ on Queen Victoria Street, London, which was eventually leased to Sumitomo Mitsui Bank and sold in December 2005 to the State Reserve Fund of Oman.

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