BT puts its City HQ on the market

BT HAS finally decided to sell its City of London head office as part of efforts to cut the group's huge debts. It has instructed property adviser DTZ International to find a buyer for the 300,000 square foot BT Centre in Newgate Street, opposite St Paul's Cathedral, according to Estates Gazette.

The news comes just one week after BT completed a £2.4 billion sale and leaseback deal with property groups Land Securities and Pears Group. That deal excluded London's BT Tower - the old Post Office Tower - and BT Centre.

But the telecoms giant wants to consolidate its staff into smaller offices after the demerger, with 16,000 staff, of its newly created mobile division mmO2 last month.

BT is understood to have drawn up detailed plans for the transfer of staff over the next year to offices at Holborn Circus in the City.

The company already occupies half of the 330,000 square foot complex, but has begun negotiations with the landlord about taking more space.

The building is owned by private clients of property agent Michael Elliott.

DTZ is believed to have been instructed to line up a sale of the Newgate Street building in the early summer and will begin marketing in the next few months. The plan is to complete a sale by next October.

As well as raising cash to reduce its debt, BT wants to withdraw from the business of owning, managing and redeveloping property to concentrate on core activities.

A source close to the company said: 'Selling Newgate Street fits in with its desire to reduce its exposure and overheads from property.'