Town Centre Securities to open London office after £3.1m deal
PROPERTY investor, developer and car park operator Town Centre Securities (TCS) is setting up a London office as it looks to expand its growing car park subsidiary CitiPark and target “selective opportunistic” investments in the capital.
The Leeds-based company, which also announced its half year results this morning, recently bought a Grade II Listed office on Duke Street in London. The building was acquired for £3.1m on a 125 year lease and is currently being refurbished.
The new office will mainly be used as a base to manage the expansion of Town Centre’s growing car park subsidiary, CitiPark, as it executes an ambitious five year plan to expand the number of branches across the UK, particularly in the South of England.
This follows the successful re-branding and re-launch of the CitiPark business last year.
In total, CitiPark currently has 11 branches and over 5,000 car parking spaces.
The recently completed £9m refurbishment of CitiPark’s flagship branch at the Merrion Centre in Leeds included the largest carbon fibre project in Europe. Its success is already helping CitiPark win further contracts in other towns and cities, like the recent partnership with Watford Council; CitiPark will soon be the new operator of three Watford Council car parks totalling 1,752 spaces.
Edward Ziff, chairman and chief executive, said: “Our new London office represents a significant landmark not only for our CitiPark business but for Town Centre Securities as a whole, the establishment of our first regional office outside Leeds. Our intention is to expand our CitiPark footprint in the UK, particularly in the South. Our new London presence will enable us to manage CitiPark’s growth whilst also providing us with the bandwidth to make selective opportunistic investments in the London market.”
TCS also updated the markets on its performance for the six months to December 2014, in which it reported underlying profit before tax of £3.4m (2013: £4m) and underlying earnings per share of 6.5p (2013: 7.5p).
With a portfolio valuation increase in the first half of £9.1m (2013: £8.2m) statutory profit before tax came in at £13.3m (2013: £12.3m).
At Leeds’ Merrion Centre, the New Front Arena Quarter development is complete with a total spend of £5.6m on the retail units producing an ERV of £0.8m, a yield of 14% producing a valuation gain of over £8m.
TCS said it is in numerous negotiations to let the remaining units and working hard to maximise the value of this scheme. The car park refurbishment is now complete and open for business trading under our new CitiPark brand.
The company said it is on track with the redevelopment of Merrion House with Leeds City Council as the tenant. This will involve adding 50,000 sq ft of new space and refurbishing the existing 120,000 sq ft. On completion Leeds City Council will take a new 25 year lease.
Progress is also being made on the £7.5m redevelopment of the Merrion Hotel, and TCS hopes to begin work during 2015/16.
Commenting on the results, Mr Ziff said: “Town Centre Securities has delivered a total shareholder return of 21% over the last 12 months ahead of the wider real estate sector. The first half has seen good performance and values have continued to move forward as the market begins to appreciate the attractions of regional property compared to stretched London valuations. Rental income growth is expected and we are also growing income through active management especially at the Merrion Centre. The car park business provides another opportunity for income growth and we continue to expand these operations.
“Our strong asset management capability continues to maintain our high occupancy levels which in turn underpin our rental income and profitability. Our performance remains in line with our expectations and we look forward to the future with confidence as the regional economy continues to benefit from the ripple effect of economic growth.”
