Financier Derek Quinlan has completed the £1 billion (€1.4 billion) acquisition of the landmark Canary Wharf building in London in a 50/50 joint venture with Propinvest, a UK-based property company. Ciarán Hancock, Business Affairs Correspondent, reports

The 42-storey building at 25 Canada Square has been acquired from Royal Bank of Scotland (RBS) in what is the second biggest property transaction in the UK. RBS owned the building for about four years. Details of the deal were announced in June but a delay in finalising funding meant it did not close until yesterday. A consortium of Irish and European banks is believed to be funding the takeover.

The property is entirely let to global investment bank Citigroup and was producing a rent of £46.5 million a year.

It is understood that Citigroup has signed a new 30-year lease on the property with Mr Quinlan and Propinvest. Rent increases have been tied to rises in the retail price index. The building, which comprises 1.2 million sq ft of space, is expected to produce a yield of 4.5 to 5 per cent for the new owners.

Informed sources said the building is now valued at £1.2 billion. This follows the completion recently of two independent valuations by estate agents, including one by Savills.

In August, Citigroup said it planned to sublet some 100,000sq ft of space at its Canary Wharf offices.

Mr Quinlan, the executive chairman of investment group Quinlan Private, is investing in the property in a personal capacity. A former tax inspector, he founded Quinlan Private in 1989; it manages assets of some €11.5 billion.

Its recent deals include the €1.16 billion acquisition of the Jurys Inn chain of three-star hotels in Ireland and the UK.

Quinlan Private last week announced plans to spend £250 million extending and refurbishing its luxury Claridge's and Berkeley hotels in London.

At the time the deal was agreed, Mr Quinlan, said: "This is a long-term personal investment in a prime property in the heart of London's new financial centre."

Propinvest is a privately-owned property group in London. Founded in 2001, it is wholly owned by Glenn Maud, who has more than 23 years' experience in property trading and investment.

It owns in excess of £2.5 billion of UK property assets and £500 million in continental Europe and Scandinavia.