Development for ‘those who desire the best’ on Palace Street in London due to be completed in 2018

A mystery buyer has paid £20m to be the Queen’s next-door neighbour, snapping up a luxury flat overlooking Buckingham Palace. In a sign that the high-end London property market is as strong as ever, the buyer has forked out the cash before the developers have picked up a spade.

Northacre, the firm behind the project, said it hopes to attract “those who desire the best and who want a home in the heart of London”. And it expects some of the larger flats in the development, called 1 Palace Street, to command even higher price tags.

Abu Dhabi Financial Group, which owns 70% of Northacre, bought the site next to Buckingham Palace for £310m in 2013 and hopes to finish construction in 2018. It has been given planning consent for a 302,377 sq foot development, comprising 72 apartments and incorporating an existing Grade II listed building. If it can attract similar prices for all of the apartments, the group can expect to rake in more than £1bn from sales.

The proud new owners will be paying not just for the prestige of sharing a postcode with Queen Elizabeth II, but also for a range of upmarket bells and whistles. Owners will have access to underground parking and a communal “courtyard garden”, while they can also make use of a restaurant and full concierge service. Leisure facilities will include “one of the largest private pools in London”, as well as a spa, gym, cinema and library.



A spokesman said the development would not include any affordable housing, but said Northacre made “an agreed financial contribution ... to support local affordable housing”. The spokesman did not reveal the scale of the contribution.

The prices of homes valued at more than £5m have come under pressure this year, with figures from property investor Jones Lang LaSalle showing an 11.5% fall in the third quarter. The decline follows an increase in stamp duty levied on expensive homes, introduced by George Osborne in December.

“We are in a market that is rewarding quality, craftsmanship and a sense of authenticity,” said a spokesman for Northacre. “Developments that do not address these key requirements of the high-end property buyer may need to reconsider their pricing.”

The Abu Dhabi investors behind Northacre also own New Scotland Yard, which has housed the Metropolitan police since 1967, after paying £370m for it last year. They plan to demolish the 1960s block in Victoria and build luxury apartments, although the familiar rotating sign that stands outside the building will remain.