Qatari Diar goes shopping in Chelsea

The company, capitalised at $1 billion, launched the mixed use Lusail project, the largest real estate development in Qatar, last December and has seen impressive sales returns on the phases released thus far. But Qatari Diar has been keen to drive forward with other ventures and recently signed a major deal in Sudan. It has now, according to Reuters, turned its attention to a possible investment in London.

Chelsea chance

Qatari Diar is currently in talks with the UK's Ministry of Defence over buying the 12.8 acre Chelsea Barracks, which is set to be vacated by the army in 2008. Sheikh Hamad bin Jassim bin Jabor Al Thani, Qatar's Foreign Minister and Qatari Diar's Chairman, confirmed the firm's interest to Reuters yesterday but would not divulge details of the bid.

The freehold site represents a prime piece of real estate in central London and is situated only a short walk from the fashionable King's Road and Sloane Square areas. It is thought the barracks will sell for close to $500 million and a competitive tender could be held, with the winner announced early next year.

The land comes under the jurisdiction of the City of Westminster Council which last month set out a planning brief for the site after discussions with key stakeholders. The existing buildings can be demolished to make way for a residential development, 50 per cent of which must be allocated to affordable housing, with substantial amounts of open space.

From the King's Road to Khartoum

While the potential London purchase would mark Qatari Diar's first major European investment and underline its strategy of balancing its asset portfolio with acquisitions away from the Gulf, the firm added to its burgeoning list of more localised projects at the end of September with the signing of a deal to develop a residential and tourist complex on the banks of the Blue Nile in Khartoum.

The development will be built on a prime site opposite the Sudanese capital's Presidential Palace and will span one million square feet. Nasser Hassan Al Ansari, Qatari Diar's CEO, revealed that the mixed use project would feature a five-star hotel, restaurants and cafes as well as retail and commercial facilities. The resort will be surrounded by residential villas and offices.

With the ongoing humanitarian disaster and conflict in Darfur in the west of the country, Qatari Diar's decision to undertake this investment might seem a little reckless, but Al Ansari said the deal was a vote of confidence in the Sudanese economy and further developments might well be announced in the future.

Strategy for success

Qatari Diar has quietly accumulated a fair smattering of projects right across the Middle East and North Africa. Even before the giant Lusail development was unveiled as its first major concern, it had already secured agreements in Morocco for a $600 million resort in Tangier and another, costing $164 million, at Ras Al Hadd in Oman. The company has also subsequently lined up ventures in Syria, the Seychelles and two in Egypt, including the Cairo Nile Corniche Towers.

This summer, Qatari Diar tied up strategic partnerships with Vinci Construction Grands Projets, a French construction outfit, and also Singapore's Capital International Asset Management, which will offer facilities management services to Diar's various completed developments.

If Qatari Diar's bid for Chelsea Barracks should prove successful, then its considered approach to real estate development, with its dual emphasis on project delivery and subsequent sustainability, will bode well for Westminster Council's hopes for a currently under-utilised and architecturally unattractive piece of land.