M&G Real Estate said in talks to finance $503m London skyscraper project

The Swiss Re Insurance building, also known as "the Gherkin", foreground, and the towers of the Canary Wharf business district are seen against the city skyline in London, U.K. Photographer: Jason Alden

M&G Real Estate Ltd. is in exclusive negotiations to fund construction of a skyscraper planned for London’s financial district after financing from Hong Kong investors fell through, according to people with knowledge of the matter.

The terms of the deal would value the plot for the 40 Leadenhall office project, nicknamed Gotham City, at about 400 million pounds ($503 million), said the people, asking not to be identified because the negotiations are private. M&G stepped in after an agreement with a group of four Hong Kong property companies, including C C Land Holdings Ltd., fell apart, they said.

Nuveen, the asset-management unit of the Teachers Insurance & Annuity Association of America, will continue to oversee the development, they said.

Representatives of M&G Real Estate and Nuveen declined to comment. A spokesperson for C C Land Holdings didn’t immediately reply to a request for comment outside of normal business hours.

Funding the 40 Leadenhall project would be a big bet on the future of London’s financial district, which has been clouded by Britain’s looming exit from the European Union. And for a U.K. firm to make a commitment of this size is a departure from the trend for overseas investors to dominate London’s office market.