Development Securities today announces that it has completed the disposal of the residential and retail components at Westminster Palace Gardens, Central London, the Wick Site in Littlehampton, and a retail park in Burnley from within the Rock portfolio for a combined £40.9 million (approx. 52 million).
The Wick Site was acquired in July 2010 for £7.6 million.
Westminster Palace Gardens, a Grade II-listed Central London building, was acquired in June 2010 for £10.1 million comprising commercial, residential and retail components. Development Securities secured planning consent to convert the majority of the offices into residential use which were sold for £20.6 million as refurbished prime residential accommodation.
Further to this, the retail component has been sold for £1.3 million. These disposals confirm a profit realization of £4.4 million, of which £2.4 million was accounted for in the previous financial period. In addition, contracts for the sale of the freehold have been exchanged and should realize an additional modest gain.
The Wick Site was acquired in July 2010 for £7.6 million as a 7 acre distribution and office facility formerly occupied by Body Shop International with whom a reverse premium of £4.9 million was subsequently secured for the surrender of its lease. Development Securities secured planning consent in February 2011 to reposition the site as a prime food-anchored retail scheme, pre-sold to Morrisons for £12.5 million for the development of a 47,500 ft² foodstore, a petrol station and a car park. After allowing project costs and partnership allocation, the realized development gain is £3.0 million.
The 42,000 ft² retail park in Burnley, previously within the Rock portfolio, has been sold for £6.5 million realizing a profit of £1.0 million. 66% by value of the Rock portfolio has now been sold, generating cumulative revenue of £27.8 million and profits of £5.3 million.
Michael Marx, Chief Executive, said: "All of these properties were acquired from the proceeds of our equity raise in July 2009. The profitable realization of these assets within a short time frame confirms our strategy of creating value by repositioning secondary or tertiary real estate into prime or near-prime markets."
Source: Development Securities