LONDON-The Covent Garden Market Authority said today that it has chosen VSM Estates, a joint venture of Paris-based Vinci PLC and Birmingham, England-based St. Modwen to assist in a $3.2 billion mixed-use development. The project is to replace the large fresh produce market with a new 500,000-square-foot facility, as well as the development of 2,800 new housing units.
The authority owns and is responsible for the operation of the market, located in the Nine Elms neighborhood of London. The market redevelopment will be funded by the sale of 20 acres for the residential units. Six groups vied to join the authority as development partner, with VSM, Barratt Developments & Kier Group, and Bouygues UK Ltd. being the final three competing for the selection.
VSM and the authority will now work on a contract, with signing expected by this summer, and construction expected to commence by mid-2013. Construction will initially focus on the building of the new market ahead of a multi-phased move of the traders into the new market facility between 20014-18. John Stanion, chairman and CEO at Vinci, said in a statement today that the team will “focus on developing a solution that enables the market to continue to trade efficiently throughout the construction program.”
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The authority said in a separate statement today that it will share more of the development plans for the 57-acres after the contract is signed. “By working with the developers we will create a new destination focused on food and flowers for London which will support the future of our tenants’ businesses, a market which we can all be proud of,” said Brenda Dean, chairwoman of the authority, in the statement. “It will create a market that is self-sustaining, and enable us to meet the government’s long-term intent of disengaging from the ownership of the market.”
The authority was advised on the procurement process by Drivers Jonas Deloitte (property), Turner & Townsend (project manager), KPMG LLP (financial) and Eversheds LLP (legal). About $895 million in revenue is gained by the current tenants at the market each year, according to the authority.
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