The first phase of the Commercial
Quarter in Ashford, a development
by Quinn Estates and George
Wilson, has now opened and
provides the prime example of
public involvement in the
The council underwrote the cost of
two floors in the 7,432 sq.metres
.) office block. The
council’s portfolio of commercial
property also includes the Park Mall
Shopping Centre and a Wilko retail unit,
the Elwick Place cinema, a hotel and
restaurant complex, Ellingham Industrial
Estate and retail units at Stanhope.
Most recently it has bought the
former Odeon building in the lower
High Street which is the home of
Cllr Graham Galpin said: “The
adoption of this strategy is another
milestone in our journey towards
becoming a commercial, self sufficient
organisation. We are seeing significant
returns from our acquisitions”.
“In the 2016-17 financial year,
International House delivered a return
on investment of 12.6% and Ellingham
Industrial Estate 12.3% I am confident
this new strategy will help us to
continue delivering terrific results on
behalf of our local residents”.
Commercial Property Register
June - October 2018www.compropregister.com
Ashford is one of the local
authorities leading the charge into
expanding their commercial
property portfolio to compensate
for the loss of government funding.
To achieve this, the council has
moved to operate more like a business
which means transforming from a
traditional local authority to become
a commercial organisation. In
particular, it takes an entrepreneurial
approach in the quest for financial
self sufficiency built around a
corporate real estate strategy.
Ashford is not alone. Canterbury
is buying property and land to
regenerate the city centre to provide
cash flow to offset government cuts.
This has meant taking full control
of Whitefriars Shopping Centre
after buying out global fund
manager TH Real Estate’s 50%
holding for £75 million.
The council plans to run the
shopping centre for at least the next
decade and ownership gives it the
ability to redevelop.
Colin Carmichael, the Council
Chief Executive, commented: “The
shopping centre takes up such a
large part of the centre of the city and
ownership gives us the opportunity to
influence the regeneration of
Canterbury in the future”.
In fact, the move by local
authorities to buy shopping centres
has grown throughout the UK as
funds and other owners are willing
to sell in the face of the changes in
shopping patterns. According to BNP
Paribas, local authorities accounted
for 70% of the purchases of
shopping centres in the first quarter
of the year, spending £255.15
million on shopping centres in
Another good example is
Shropshire County Council buying
three shopping centres for £50.75
million in the centre of Shrewsbury to
support economic growth. The logic
for councils is that they can borrow
cheaply from the Public Works Loan
Board, an arm of the Treasury.
There has been some criticism of
the councils buying shopping centres
at this stage of the property cycle.
For example, James Findlater of
Colliers International said: “Councils
have come in and will pay
yesterday’s prices for assets they are
not well placed to manage”.
Canterbury acknowledges its
need for management expertise but
points to its low borrowing costs as
providing positive cash flow from the
The Ashford model is more
embracing and involves the council
in the early stages of development.
Whitefriars Shopping Centre
A new partnership of Linton Group
and Henika has bought its first
two properties at 9-11 Wellesley
The partnership will focus on
commercial sites with asset management
potential in London and the south
east and the 5,574 sq.metres
.) Croydon properties
present various options, such as
Gary Linton of Linton said: “We are
expecting big things from Croydon
and fully believe in its potential as
one of London’s emerging commercial
and residential hotspots”.
The properties are at the centre of
Croydon’s £5.25 billion regeneration
programme, which seeks to change
perceptions of the area by turning it
into one of London’s cultural centres.
In particular, it is close to the £1.5
billion Westfield retail and leisure
complex by Westfield and Hammerson.
At the heart of many of the
property-related problems in the
three counties is the pressure on
Time and again we see the
familiar arguments. Too much
employment land is going for
residential property, not to mention
the conversion of office buildings for
a similar end use.
The local population in many
areas are protesting about this because their services, such as schools and
medical centres, are being stretched and their roads increasingly congested.
While it is important to build more houses, this should not be at the
expense of commercial development to achieve an expanding economy.
Also, it is arguable that too much housing is being built in the south east.
The result is that office and industrial rents are rising and in many
areas the shortage of land for industrial development is acute. On the
other hand, the growing investment by local authorities in commercial
land and buildings to counter government funding cuts may push them
in the direction of putting commercial development higher up the scale
What is needed is a more balanced approach. For example, building
an IKEA and 600 new houses in an area of acute traffic congestion seems
daft. Get the infrastructure right first and then build the big store.
ORE FOCUS ON
9-11 Wellesley Road
Cllr Graham Galpin