LONDON’S housing market has hit a new high, with the purchase for a record £900m of the Chelsea Barracks by a consortium fronted by two brothers in their early thirties.

Sources close to the deal disclosed this weekend that the 12.8acre site cost almost four times the Ministry of Defence’s asking price, and £300m more than previously reported.

The enclave, between Sloane Square and the river Thames, now has the unofficial title of Britain’s most expensive residential development site at £70.3m per acre.

It is the boldest move yet by Nick and Christian Candy, who started in the property business a decade ago, and made their fortune by selling luxury to the oligarchs and the new wave of migrant super-rich.

Boris Berezovsky was believed to be an early customer and they had the backing of Sheikh Hamad bin Jasim Jaber al-Thani, the foreign minister of Qatar, for One Hyde Park, a luxury flats scheme, designed as a “fortress”.

It was built on the site of a 1950s office block on the edge of Hyde Park, acquired for £150m and demolished. The Richard Rogers design of the new flats consists of a series of diamond-shaped blocks with facades of glass and red weathered steel, overlooking Hyde Park.

The Chelsea deal exceeds the £58m per acre paid last year by a consortium involving the brothers for the site of the Middlesex hospital, north of Oxford Street.

For Candy and Candy, the fact that the MoD site is a 1960s eyesore - a target of an IRA bombing in 1981 - should make the redevelopment more lucrative, as most of it can be demolished.

Nick Candy explained the thinking behind the brothers’ ability to anticipate the whims of the super-rich in an interview with The Sunday Times last autumn.

“The idea that people prefer to live in grand listed buildings is gone,” he said. “You can’t get underground parking, you can’t fit proper air-conditioning.

“It’s like having a vintage Ferrari. It’s a beautiful thing, but it comes with a host of problems.”

The brothers have again turned to Lord Rogers for the design of the Chelsea scheme. This weekend he said he was “very excited by the site. It’s close to the Thames and next to one of the most beautiful buildings in England, the Royal hospital, by Christopher Wren and John Soane.

“From my point of view it’s fantastic - I can see the site from my bedroom. It’s one of the very last chances to build an estate similar to those in Mayfair and Belgravia”.

Rogers Stirk Harbour, his architectural firm, has yet to draw up detailed plans, but the apartment blocks are likely to feature large “lateral living” spaces, confined to one floor. The blocks will be no more than 10 storeys high, and could be topped by wind turbines.

Previous developments by the Candy brothers have featured “fur fridges” for mink coats and heated tarmac in underground car parks. They have also installed memory-programmed mirrors. These look like ordinary mirrors but are video screens with a time delay function, which allows you to check how you look from behind.

The super-rich, who are expected to pay up to £50m each for flats in the Chelsea development, will be forced to live alongside bus drivers and bin men. The local authorities, led by Ken Livingstone, the mayor of London, are insisting that half of the properties on the site are “affordable homes”.

The planning rules for large developments state that 50% of the homes should be affordable, with 35% “for residents in need” and 15% “intermediate housing for key workers”.

Typically, developers fulfil their quota by building affordable housing on other sites. But Westminster council is insisting that the cheaper homes are built alongside the luxury apartments.

A source within the Candy and Candy team indicated this weekend that it would seek to place cheap housing at one end of the site. The council intends to block such tactics.

Since the murder of John Monckton, the banker, at his Chelsea town house, secure flats have been particularly coveted, yet the council insists the streets should be open to the public and not gated.

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