Mixed-use Vauxhall development on track after funding from Cheyne Capital

An alternative investment fund manager has announced it has provided a senior loan of more than £100 million (£103 million) to finance the acquisition and development of a residential-led mixed-used scheme in Vauxhall, south London.

Cheyne Capital’s funding is for the 279,900 sq ft site – named ‘Graphite Square’ – situated within the Vauxhall, Nine Elms & Battersea Opportunity Area, which also includes Battersea Power Station and a range of other new developments.

Graphite Square will provide new homes, workspace and amenities for the area, with planning permission granted by Lambeth Council for 160 new one to three-bed private homes, 50 of which will be affordable, as well as over 80,000 sq ft of workspace and 400 sq ft of retail. The affordable housing units have already been sold and the office space has been pre-let on a 12-year lease.

In line with the recent trend for greater sustainability, the scheme will include solar PV panels, air source heat pumps, ample cycle storage, green spaces and a children’s play area, as well as aiming for a BREEAM rating of Excellent and an EPC rating of A.

Those behind the scheme insist that the affordable homes will have the same access to the scheme’s amenities as the market-rate homes, to ‘create an inclusive community across the development’ – a requirement that is a key tenet for Cheyne.

The project is being sponsored by ‘highly experienced; Australian property developer, Third.i – a firm with a successful track record in creating large-scale residential, commercial and senior living projects throughout Australia. Graphite Square will be its second major development in London and will aim to meet ‘the highest quality and environmental standards’.

“This investment not only underscores Cheyne’s commitment to working with experienced sponsors which have a thoughtful vision to build sustainable developments that will benefit the whole community, but also our continued interest in investing in multi-purpose sites,” Arron Taggart, head of UK real estate at Cheyne Capital, said.

“We’re pleased to be partnering with Third.i on their second London development and look forward to working together to bring high quality and affordable homes, offices and retail space in this desirable location.”

Ron Dadd, global managing director at Third.i, added: “We’ve been looking for exciting opportunities in London for some time, and Graphite Square is the perfect embodiment of our belief in creating better places to live, work and play. We instantly fell in love with the architecture and place making of the project, seeing it having an ageless appeal that will become a legacy project, one we all can be proud of.”

He went on: “It’s a development which we believe can have an incredible effect on the Vauxhall area and the prospects of all its residents, and we are very proud to be working with partners who passionately share our beliefs and desire to make this happen. We all look forward to working closely with Lambeth Council and the local community to bring our plans to fruition.”

The investment comes from the sixth and seventh vintages of Cheyne’s CRECH programme, the firm’s real estate direct lending strategy that was launched in 2011.