Your Space announces sales and lease back
Tuesday, November 07, 2006
Your Space is today pleased to announce that, on 6 September, it exchanged contracts for the sale and lease back of its Grade II listed business centre at 23 New Mount Street Manchester, for the sum of £6.075m, the completion of which is subject to an environmental report on the site, which is expected to be carried out in the next 2 weeks.
Headlines:
- £6.075m disposal of 23 New Mount Street, Manchester
- £1.9m book profit
- £2.5m of cash generated
- Financial year to date disposals generate proceeds of £12m
- Disposals generate £2.8m book profit
The building has benefited from an extensive restoration and investment programme over the past 15 months that has seen the average rental rates rise by up to 200% post refurbishment. By disposing of the freehold but retaining a lease on the site, Your Space can continue to enjoy the benefit of this established and high quality business centre.
The disposal price represents a £1.9m book profit. and will generate cash of £2.5m. Following the disposal of The Bridge, 12-16 Clerkenwell Rd in May of this year profits from disposals is approximately £2.8m.
This latest transaction takes the total gross proceeds from disposals in our current financial period 2006/7 to £12m. The Company continues to seek to maximise returns from capital freed by such disposals and in this period the company has completed the acquisition of two Grade II listed buildings for the combined value of £5m. Both buildings require extensive restoration work.
The sale of the building at 23 New Mount Street does not include the adjoining land where the company has recently been granted planning permission to construct a 7 storey, 219-bedroom student accommodation block. The site is currently being valued and the Your Space directors are considering using the asset as security towards other property acquisitions.
The refurbishment work at our Willenhall location is progressing well, and it is encouraging that we are seeing an increase in the rental rates to space that has been sold post restoration. It is planned to spend over £750,000 on the works in the course of this year. We also intend to seek planning permission to develop part of the site for residential use.
Likewise the restoration work on the Grade II listed site known as the Heywoods building in Liverpool is progressing well and the Board is considering placing this property on the market in the near future for an outright sale of the freehold.
Our serviced office centres are performing as expected and the infrastructure in place now enables a focused management team to continually deliver both improved levels of service to our customers and to increase the volume of space that is managed.
Your Space is currently in negotiations to purchase further sites that require development and continues to consider ways to maximise returns for shareholders.
