Council secures £7m deal for business park
ONE of Wales’ leading business parks, whose tenants including technology firm Mitel, has been acquired in a £7m deal.
Using its borrowing powers, Monmouthshire County Council has acquired Castlegate Business Park in Caldicot, from property development firm Robert Hitchins.
Located on a 17-acre site, the park provides 220,0000 sq ft of office space
The council’s cost of borrowing cost will be met from the park’s rental income and will not impact on the provision of public services.
It is anticipated that the investment will generate an annual return of 7%.
The deal is the latest move in the council’s strategy of commercial portfolio. It said the acquisition consolidates a key strategic site at the gateway to south east Wales and demonstrates a commitment to the continued regeneration of Caldicot.
Council cabinet member for enterprise, Bob Greenland said: “I am delighted that we have been able to complete this deal.
“The acquisition helps take forward a number of our strategic goals and is a clear demonstration to investors nationally and internationally that Monmouthshire is a great place to do business.“
Monmouthshire has never been afraid to take a commercial approach, to innovate and be creative where it helps us to promote the vitality of our county.”
The council has financed the deal by borrowing from the UK Government’s Public Works Loans Board, which provides funding to local authorities repayable over the longterm at low rates of interest.
Simon Tothill, property and development director of Robert Hitchin, said: “Having implemented a successful asset management strategy over a number of years, Castlegate Business Park is close to full occupation and plays an important role in the local economy.
“The sale to Monmouthshire County Council made sense and the council is well positioned to benefit from an attractive rental stream whilst investing in its own region.
“This deal fits with Robert Hitchins’ ongoing investment strategy with money released from this sale allowing us to reinvest in existing assets and new developments throughout south Wales.”
The park provides a range of office, data centre, production and warehouse accommodation. It has air conditioning, conference and lecture theatre facilities, a restaurant and 24-hour on-site security.
As well as Mitel other tenants include Microsemi, Vanderbilt International and Evoqua Watertec.
Property advisory firm Alder King represented Monmouthshire County Council. JLL acted for Robert Hitchins.
Robert Hitchins, based in Gloucestershire, is one of the leading property developers and investors in south Wales and the south west of England.