CapitaLand cannot evict art gallery: British High Court

S Franses, a London art gallery specialising in antique textiles, has been at The Cavendish hotel in Jermyn Street for the last 25 years. CapitaLand, which owns the hotel, wanted to redevelop the space into two retail shops.
S Franses, a London art gallery specialising in antique textiles, has been at The Cavendish hotel in Jermyn Street for the last 25 years. CapitaLand, which owns the hotel, wanted to redevelop the space into two retail shops.PHOTO: S FRANSES

Britain's High Court has dealt a blow to Singapore's CapitaLand after it ruled that the property giant was not allowed to evict a tenant in order to redevelop a prime space in the heart of London.

The legal battle first went to a London County Court in January, which ruled in favour of CapitaLand. The tenant, S Franses art gallery, appealed to the High Court, which earlier this month overturned the lower court's decision and ordered CapitaLand to pay its tenant's legal costs for both hearings.

S Franses, a world-leading London art gallery specialising in antique textiles, has occupied the ground floor and basement of The Cavendish hotel in Jermyn Street in London's art and antiques district of St James' for the past 25 years.

CapitaLand's subsidiary, The Ascott, bought the 180-year-old hotel for £158.8 million (S$283 million) in 2012. The dispute began after CapitaLand rejected the gallery's request for a new 15-year lease in March 2015.

The property company wanted to redevelop the space into two retail shops to be rented out.

Many art galleries, specialist traders and antiques dealers have been forced out of the area in recent years by rising rents. A proposal to protect them was passed last year to preserve the historic character of the district.

S Franses and another Jermyn Street tenant, bespoke shoemaker Foster & Sons, successfully applied to the local council for planning protection. These two properties now can be used only as an art gallery and for bespoke retail.

In a bid to remain on the premises, art gallery owner Simon Franses took CapitaLand to court on Jan 16.

He has been adamant about staying as his business is well-established in the area, and significant investments have been made to house centuries-old textiles in a climate-controlled environment.

"After being a respected and valued tenant of The Cavendish hotel for 25 years, there was never any offer or negotiation," Mr Franses said in a statement, adding that CapitaLand chose to evict his gallery rather than "celebrate its prestigious heritage".

The gallery, founded in 1909 by Mr Franses' grandfather, Sidney, is recognised as an expert in historic textiles, tapestries and carpets.

CapitaLand plans to appeal the latest decision.

Mr Marc Sandfort, London area manager for The Ascott, told The Straits Times: "The outcome of the High Court decision on July 3 is that, subject to any appeal by either party, the case is to be remitted back to the County Court for further consideration. Accordingly, we would be happy to comment once the litigation has been finally concluded."

A version of this article appeared in the print edition of The Straits Times on July 31, 2017, with the headline 'CapitaLand cannot evict art gallery: British High Court'. Print Edition | Subscribe