Skip to main content

The Globe and Mail

Indian developer buys Canadian High Commission in London for $530-million

Macdonald House is a seven-storey building on Grosvenor Square in Mayfair, London that is part of the High Commission of Canada in London. Macdonald House hosts the trade and administrative sections of the High Commission, as well as the High Commissioner's official residence.

It has been home to more than a dozen Canadian High Commissioners to Britain over the past 50 years, including Paul Martin Sr., Fredrik Eaton and Roy McMurtry. But now the stately building at One Grosvenor Square in London's Mayfair district has been sold to a developer from India for $530-million.

The federal government announced in February that it was putting the High Commission up for sale as part of a cost-cutting exercise. The actual listing didn't take place until October and the seven-storey building was in hot demand, generating more than 100 viewings and 20 bids. A final deal was reached this week with the Lodha Group, a family-owned business that is the largest residential developer in India.

"It has been an incredibly quick process," said Simon Stone, director of national development at Savills Plc., which handled the sale. "This is not a typical property. It's a large redevelopment opportunity in one of the best garden squares, in one of the best locations, in probably the most sought after city on the planet. They don't come along very often."

Story continues below advertisement

Lodha's managing director, Abhishek Lodha, said in a statement that the building presented "a great opportunity for our company." This is Lodha's first deal outside India and the company is expected to turn the Grosvenor Square property into luxury condominiums.

Grosvenor Square dates back to the early 1700s when Sir Richard Grosvenor built a row of buildings in what became among the most fashionable homes in London. John Adams lived in the building in the late 1700s, after becoming the first United States minister to the Court of St. James's. Part of it remained a U.S. embassy until 1962 when Canada bought One Grosvenor Square from the Americans and renamed it Macdonald House as Canada's High Commission.

Canada joins a growing list of countries selling diplomatic posts in London, as leases expire and property values soar in upscale neighbourhoods like Mayfair. While house prices climbed 7 per cent year-over-year in October across Britain, they jumped around 11 per cent in Mayfair, which is considered one of the most expensive parts of London. The median price of homes in Mayfair is around $3.5-million and most of the properties sold in the past year have been bought by wealthy foreigners.

The United States sold its embassy in Mayfair in 2006, for an estimated $800-million, to Qatar's state-owned developer, Qatari Diar. The Americans are building a new embassy in a far less trendy area south of the River Thames near the Battersea Power Station. Today, 20 embassies across Central London, worth an estimated $5-billion in total, are either up for sale or about to be sold, according to Diplomat magazine.

Like many buildings in Mayfair, the Canadian High Commission is technically owned by the Duke of Westminster and what has been sold is a 999-year lease to the building. Mr. Stone said the lease is unlikely to prevent Lodha from turning the building into residential units.

While stately on the outside, the 135,000-square-foot High Commission had been stretched to its limit to accommodate the commission's 250 staff, and many of the hallways and offices are cramped. The commission will now be based out of Canada House, a historic building next to Trafalgar Square that has been used as a Canadian cultural centre since 1925.

Ottawa will use proceeds from the High Commission sale to buy an adjacent building next to Canada House and renovate both. Canadian High Commissioner Gordon Campbell said he expected the total cost of the project to be around $300-million.

Story continues below advertisement

"I think it's going to work for everybody," said Mr. Campbell. "We are going to send a bunch of money home, which is what people want, but more importantly we're going to have a better High Commission in a better place." He added that the sale price for the Grosvenor Square building was more than he expected. "I think it's a very good deal for Canada."

Report an error Editorial code of conduct Licensing Options
As of December 20, 2017, we have temporarily removed commenting from our articles. We hope to have this resolved by the end of January 2018. Thank you for your patience. If you are looking to give feedback on our new site, please send it along to If you want to write a letter to the editor, please forward to