The owner of Trinity Mirror’s headquarters has revealed its future is under threat as plunging commercial property values put it in danger of breaching key banking agreements.
Songbird Estates, which has owned the Canary Wharf development in London since 2004, said there was a risk of it falling foul of banking covenants within the next 12 months on an £880m loan if prices fall further.
The One Canada Square tower, home to Trinity Mirror and JP Morgan, is now priced at £688.4m compared to £857.6m at the end of 2006.
The development has been badly affected by the credit crisis and a commercial property downturn, while its tenants have been crippled by the financial market woes.
Lehman Brothers used to rent space before it collapsed, Morgan Stanley has already moved out and Bank of America is reportedly considering doing the same.
Owners of Canary Wharf have gone bust before, with the original builders Olympia & York going bankrupt amid the early Nineties property crash.