Bruntwood confirms purchase of key Birmingham city office building
BRUNTWOOD, the family-owned property developer and investor, has confirmed its purchase of the former head office of KPMG in Birmingham.
Chief executive Chris Oglesby said the 2 Cornwall Street building formed a key part of the firm’s 2015 strategy.
The building, which had been owned by Royal Bank of Scotland, has been vacant since KPMG moved into One Snowhill three years ago. Details of the deal have not been disclosed but rumours last year suggested the bank had been looking for offers around £10m.
Bruntwood has not expanded on its plans for the building but West Register, RBS’s internal property company, had put in for outline planning permission for a 263,150 sq ft office tower on the site in late 2013.
Planning had been in place for a majority demolition of the building and the construction of a new 190,000 sq ft office tower across 12 floors at an estimated cost of £35m.
The plans were drawn up by Birmingham-based Associated Architects.
Conformation of the purchase came in the statement supporting Bruntwood’s 2014 annual results, which have been hailed as a “stand-out year” for the business with profits surging 56% to £19.3m.
The Manchester-based group, which already owns and runs three Birmingham city centre buildings: Cornwall Buildings in Newhall Street, the McLaren building on Priory Queensway and Centre City in Hill Street, said its net worth had increased 25% to £358m during the year.
Oglesby said: “2014 has been a standout year for Bruntwood. The fact that we continued to invest in our portfolio during the economic downturn has positioned us well to fulfil the uptake in demand that we’ve seen across all of our markets as the economy has recovered and the focus has shifted to the major City Regions as engines of growth.
“We have always aligned our business with the strategic direction of the economies in which we operate. Political initiatives such as the Northern Powerhouse and further Regional Devolution are good for the future of our cities and therefore good for our business as well.
“It’s our opinion that with the strength of our occupational markets coupled with long term gilt rates at an all time low of 1.5%, we are likely to see significant further growth in commercial property values in our markets.
“We therefore enter 2015 with confidence as we deliver a development pipeline of over 2 million sq ft including Alderley Park, 3 Sovereign Square and City House in Leeds, Cornerblock in Manchester, the new 70,000 sq ft Heart of the Park at MSP, Manchester Business School and 2 Cornwall Street in Birmingham as well as fulfilling our ambitious plans for Manchester Science Partnerships.”
Bruntwood, which is owned by the Oglesby family and gives a share of its profits to good causes and arts projects, said it had cut its debt from £590m to £440m and from 66% to 55% of the value of its buildings. In doing so, it agreed a new £300m five year banking facility with RBS, Barclays, HSBC and Santander at the end of 2014.
During 2014 it completed a number of major redevelopments including Manchester One, Centre City in Birmingham, Cotton Exchange in Liverpool and 100 Wellington Street in Leeds.
It also increased its majority stake in Manchester Science Partnerships and purchased the 400 acre, 1.7m sq ft Life Sciences site, Alderley Park in Cheshire as well as completing the development of Citylabs on the Corridor in Manchester.
