BT makes £275 million from sale of BT Tower

The move forms part of the UK telecoms incumbent's ongoing cost-cutting drive that, amongst other things, saw it move out of its former BT Centre headquarters near St Paul's just over two years ago.

The sale of the tower is capturing broader media attention though, arguably because it's not only an iconic structure, but also a much more visible sign of change at BT. The main part of the tower is 177 metres high, with a sizeable section of aerial taking its total height to 189 metres. And it has the BT logo emblazoned on the top.

Even though it clearly makes a lot of financial sense, there's something of an end-of-era vibe about this announcement. Much more so than when the building ceased to be the Post Office Tower in the 1980s, although that was really a rebrand.

BT is playing it with a straight bat though; it doesn't need the site any more, but it does need to save some cash, and has made no secret of the fact that the tower sale is part of that broader property portfolio simplification drive that has seen it reduce its offices to around 30 from 300 and included the aforementioned HQ relocation from St Paul's to Aldgate. It didn't really comment on the £275 million it will ultimately bring in from the sale though.

We might be used to the BT Tower being a London landmark and events venue, but it was built as a communications tower, hosting microwave radio equipment. While it has facilitated a number of network operations for BT, these have gradually migrated away and are now delivered by the telco’s fixed and mobile networks.

The microwave aerials are long gone, having been removed more than 10 years ago, as they were no longer needed for carrying traffic. And BT is also migrating its media and broadcast services onto a cloud-based platform, which will negate the use of the tower.

"The BT Tower sits at the heart of London and we've been immensely proud to be the owners of this important landmark since 1984," said Brent Mathews, Property Director at BT Group. BT, then British Telecom, was privatised in 1984.

"It's played a vital role in carrying the nation's calls, messages and TV signals, but increasingly we're delivering content and communication via other means," Mathews said. "This deal with MCR will enable BT Tower to take on a new purpose, preserving this iconic building for decades to come."

It may be some time before the tower actually becomes a hotel though. BT said that the £275 million payment for the building "will be made over multiple years" as it gradually removes its equipment. The final payment will come on completion of the purchase, it said, but did not disclose when that is likely to be. Either it doesn't yet know how long it will take to pull out all of its kit, or it's reluctant to share the info.

Added to that, common sense says it's quite an undertaking to turn a former telecoms tower, albeit one with a history of hospitality, into a modern hotel.

MCR Hotels didn't have much to say on the matter. Tyler Morse, CEO and owner of MCR Hotels, essentially echoed BT's sentiments. "We are proud to preserve this beloved building and will work to develop proposals to tell its story as an iconic hotel, opening its doors for generations to enjoy," he said.