UBS's 340 million pound London headquarters will go ahead after the Swiss bank signed an pre-letting agreement with the site's co-owners British Land and Blackstone Group.

British Land and Blackstone said on Monday the 700,000 square foot building in London's City financial district will be built by the fourth quarter of 2014.

Concerns that UBS would pare back the project surfaced last September, after the bank's plans for its investment banking arm came under intense scrutiny following a $2.3 billion unauthorised trading loss linked to alleged rogue London trader Kweku Adoboli.

The bank, which is the largest tenant in the 30-acre Broadgate development in London's City financial district, signed a deal for the new bespoke block in August 2010. It would include four trading floors, which can be adapted into normal office space.

The two companies said UBS will occupy the new building for around 18 years at an initial rent of 54.50 pounds per sq ft, subject to annual increases, and will also be given a rent-free period of 18 months. ($1 = 0.6383 British pounds)

(Reporting by Brenda Goh; Editing by Erica Billingham)