How does one assess the future opportunities and inherent risks associated with investing in an underdeveloped parcel of land in East London?
Canary Wharf, one of London’s two main financial centers (along with the City of London), was built on the site of the old West India Docks on the Isle of Dogs in East London. During the takeover battle between Songbird and Brascan (which concluded in July 2004), both bidders faced the task of ascribing an appropriate value to the developable land bank in order to prevail in the protracted public auction of the Canary Wharf Group plc. This case asks students to assess the land value, the timetable for development, the required rates of returns, and risk factors associated with the deal.
Case ID: 101703