LS Trillium and DVLA sign property outsourcing contract (UK)

Land Securities Group PLC announces that Land Securities Trillium has signed its property outsourcing contract with DVLA. Under the terms of the transaction, DVLA has outsourced a major refurbishment program, life-cycle capital expenditure, estates management and facilities management across its entire UK estate to Land Securities Trillium for 20 years.

While Land Securities Trillium will be taking on rental obligations for DVLA, there will be no transfer of freehold property to Land Securities Trillium. Land Securities Trillium will receive payment for the provision of its services and refurbishment works, via a performance-related annual unitary charge and expects the contract to become profitable in 2007.

The estate comprises 58 properties, totaling 94,133 sq m, of which 14% by area involve the transfer of leasehold liabilities.

The major refurbishment of DVLA’s headquarter site at Morriston, Swansea will result in a £30 million investment by Land Securities Trillium over the next three years. The headquarter site comprises 13 buildings totaling 65,711 sq m.

DVLA’s objectives in undertaking this long-term agreement are:
- to attain modern, efficient and flexible working environments to support their cultural change program;
- to achieve operational efficiency and cost savings by dealing with a single “best in class” supplier;
- to create financial certainty, transparency of costs and best value for money.

Ian Ellis, Chief Executive of Land Securities Trillium, commented, “This is our third new client this financial year showing the growing interest in property outsourcing as a flexible solution. The contract demonstrates that DVLA is a forward-thinking organisation and how they have committed to implementing innovative changes to improve their organisation and help to achieve the recommendations of the Government’s efficiency review.
“We are delighted to be working with them to deliver better workplaces for their employees and customers, to simplify their property operations and to create best value for money.”

Clive Bennett, Chief Executive of DVLA, commented “The contract will provide a foundation underpinning the DVLA’s cultural change programme. It offers the opportunity to provide modern, efficient and flexible working arrangements in an enjoyable environment suited to a 21st century organisation.”

Ieuan Griffiths, Finance and Strategy Director of DVLA, welcomed the opportunity offered by the contract, commenting “The DVLA’s commitment to embrace new ways of working requires broad investment. Looking at alternative solutions, this contract offers best value for money for the taxpayer.”

Source: Land Securities

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