I’ve written before of a ‘curse of Qatar’ that might explain misfortunes attending the Gulf state’s UK investments, of which the seven-years-delayed Chelsea Barracks redevelopment is an example. I also claim to have coined ‘curse of Canary Wharf’, a phenomenon afflicting not only financial tenants of the Docklands complex but visitors such as Gordon Brown, who never lived down his speech congratulating Lehman Brothers on ‘the contribution you make to the prosperity of Britain’ at the opening of the doomed bank’s office tower there. So the prospect of a renewed Qatari bid for Songbird, the corporate owner of Canary Wharf, fills me with foreboding.
A first 295-pence-per-share offer by the Qatar Investment Authority, which already holds 28.6 per cent, in partnership with US-Canadian investor Brookfield which holds 22 per cent, was firmly rejected. An improved offer above 350 pence was widely expected this week. Readers who have been following the shenanigans surrounding Qatar’s winning bid to host the 2022 World Cup, and have pondered the ambiguity of Qatar’s position as both a member of the military alliance against the Islamic State and, allegedly, a major funder of Islamist groups, may wonder whether this wheeler–dealer sheikhdom is ‘fit and proper’ to throw its money around London on such a scale: it already owns chunks of Barclays and Sainsbury’s as well as Harrods, the Shard and the Olympic Park, and is apparently now keen to buy into our high-speed rail projects.
And what of the future of Canary Wharf? It has plans to develop 3,000 homes on an adjacent site, and from 2018 Crossrail will bring it superfast links to the West End and Heathrow. So the marketing men can claim a new era dawns: but the gleaming towers and giant trading floors at the core of the estate were built to accommodate an era of finance that is passing and looks daily more tainted — last week’s forex trading revelations offering final confirmation of an incorrigible propensity to cheat combined with chronic failures of management. You might say Qatar and Canary Wharf richly deserve each other, or you might say I’m overdramatising; but when curses collide, don’t expect positive outcomes.
Fuel warning light
‘Red warning lights are once again flashing on the dashboard of the global economy,’ wrote the Prime Minister. And although Ed Miliband and others were probably right to accuse him of getting his excuses in first ahead of the Chancellor’s autumn statement on 3 December, no one said he was wrong. He was right in particular to highlight the threat to our own recovery from the ‘teetering’ eurozone. But the red warning light that interests me most is one David Cameron didn’t mention in his Guardian article on Monday: the falling oil price.
Brent crude started the week at $78 a barrel, having approached $115 in June, and the International Energy Agency expects the downtrend to continue well into 2015. Good news for petrol prices; bad news for Nicola Sturgeon, for whom North Sea oil revenues are shrivelling; bad news for Vladimir Putin, who may become even nastier as a result; bad news for all of us as an indicator of weaker global industrial demand; and dangerous in the sense that Opec may be letting the price deflate (rather than tightening supply to puff it back up) in order to knock out expensive non-Opec sources and disrupt the US shale gas sector, where highly leveraged operators are at risk of debt default if prices fall below their break-even levels. As I’ve said before, it’s a curious twist that cheaper oil can make us more vulnerable to Middle East volatility, not less.
Canary Wharf, wholly North American in concept, has never been called a ‘great British brand’. McVitie’s Digestives and Jaffa Cakes, however, most definitely fall in that category, and I’m intrigued to see their maker, United Biscuits, being sold by its private-equity owners to Yildiz, Turkey’s leading food conglomerate (a previous sale to Bright Foods of Shanghai, announced in 2010, having fallen by the wayside). Yildiz apparently has no plans to shift production from the UK to domestic factories. But as with the Qataris, there’s an Islamic angle: my man in the Grand Bazaar tells me the group is ‘known to be a bit religious’ and has connections to the socially conservative AKP party of President Erdogan — adding a touch more spice to our Ginger Nuts.
And here’s another one gone. Coming out of a restaurant in Hollywood last week, I found myself facing a showroom of Farrow & Ball, the Dorset-based supplier of posh paint in muted shades of Mole’s Breath and Dead Salmon. ‘You’re a long way from home,’ I thought — only to read later that the firm, which last changed hands for £80 million in 2006, is about to be bought for £250 million by Ares, a Los Angeles private equity firm that also owns the department store Neiman Marcus. That price hike must be a side effect of Hollywood folk suddenly wanting their homes to look like Downton Abbey. I hope Julian Fellowes gets a cut.
Leaving Las Vegas
It turns out I have at least one reader in Las Vegas: not a billionaire casino owner but a British expat who went for a holiday and liked it so much he bought a ‘condo’, at the nadir of Nevada’s recent real estate slump, for ‘the price of a beach hut in Brighton’. You can learn to love Vegas, he says, once you get past the theme park of sin I described last week. Well, maybe. My last glimpse as I headed for the airport was a huge banner on the front of one of the cheaper casinos: ‘Vets eat for free.’ The cab driver reminded me that tomorrow was Veterans’ Day, when America expresses gratitude to former military personnel: except in Vegas, where they were being enticed to blow their welfare payments on the slot machines. And there’s me thinking the banner had something to do with kindness to animals.
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