TCS en­joys strong pipe­line of work

Owner of Mer­rion Cen­tre op­ti­mistic

Yorkshire Post - Business - - FRONT PAGE - LIZZIE MUR­PHY BUSI­NESS REPORTER ■ Email: lizzie. mur­phy@ypn.co.uk ■ Twit­ter: @lizziec­mur­phy

PROP­ERTY: Profit dipped at prop­erty firm Town Cen­tre Se­cu­ri­ties but the group said low in­ter­est rates, low in­fla­tion and a strong pipe­line of work would drive up the fig­ure in the fu­ture. The group said it has a strong pipe­line of de­vel­op­ments and re­fur­bish­ments, with over £ 30m of de­vel­op­ment spend un­der­way.

PROP­ERTY IN­VESTOR and car park op­er­a­tor Town Cen­tre Se­cu­ri­ties re­ported a 12 per cent dip in prof­its in the first half of the year but said low in­ter­est rates, low in­fla­tion and a strong pipe­line of work would drive up the fig­ure.

The Leeds- based firm said pre­tax profit fell to £ 11.7m for the six months to De­cem­ber 31, down from £ 13.3m in 2014, due to a lower val­u­a­tion move­ment on in­vest­ment prop­er­ties, which went down to £ 7.6m from £ 10.1m.

Net rev­enue rose to £ 9.3m from £ 8.8m, whilst net as­set value per share rose to 359p at the end of De­cem­ber from 326p at the same point a year ear­lier.

Chair­man and chief ex­ec­u­tive Ed­ward Ziff said: “We be­lieve that the cur­rent low in­ter­est and low in­fla­tion en­vi­ron­ment is here to stay for the fore­see­able fu­ture and will con­tinue to give us op­por­tu­ni­ties to grow our in­come and prof­its and thereby en­able us to fur­ther en­hance the net as­set value of the group.”

The group, which owns the Mer­rion Cen­tre in Leeds, said it has a strong pipe­line of de­vel­op­ments and re­fur­bish­ments, with over £ 30m of de­vel­op­ment spend un­der­way.

Work con­tin­ues on the £ 34m re­fur­bish­ment of Mer­rion House, which con­sists of 120,000 sq ft of of­fices and cre­ation of 50,000 sq ft of new of­fice space. The pro­ject, which is ex­pected to com­plete in 2018, is ex­pected to add £ 5m to net as­sets and £ 0.9m to an­nual in­come.

Mean­while, work is also un­der­way on turn­ing Mer­rion Ho­tel into a 134- room Ibis Styles ho­tel and Marco Pierre White restau­rant, which is sched­uled for com­ple­tion in the first half of 2017.

It is ex­pected to add £ 0.6m to an­nual in­come, grow­ing to £ 1m.

The com­pany has also agreed a deal with Premier Inn for its £ 10m, 136- bed­room ho­tel on White­hall Road where prepara­tory works are un­der­way.

The value of the site upon com­ple­tion is es­ti­mated to be in ex­cess of £ 12.5m.

De­fend­ing the de­ci­sion to bring an­other Premier Inn to Leeds, which al­ready has six in and around the city, Mr Ziff said: “What Leeds is short of is ho­tel oper­a­tors at the cor­rect place in their mar­ket. Five star is not what the mar­ket needs.”

He added: “If we opened a new brand of ho­tel it would take a long time to es­tab­lish it­self. Peo­ple know what they are get­ting with Premier Inn and it’s a great of­fer.”

TCS said dis­cus­sions are con­tin­u­ing in re­spect of the next phase of the of­fice de­vel­op­ment at White­hall River­side and a 500- space multi- storey car park on the above site.

Mr Ziff de­scribed the last six months of 2015 as “busy, ex­cit­ing and in­ter­est­ing”. He said the up­turn of the York­shire prop­erty mar­ket pre­sented lots of op­por­tu­ni­ties for the com­pany and said his fo­cus was on work­ing hard at en­hanc­ing value across its port­fo­lio in the re­gion.

He said the First Di­rect Arena had boosted late- night foot­fall at the Mer­rion Cen­tre, but added that the chal­lenge now was to get re­tail­ers to stay open for longer. “On arena nights, the bars and restau­rants are buzzing un­til 11pm,” he said.

The cen­tre’s over­all oc­cu­pancy rate is 96 per cent and Mr Ziff said TCS was in talks with some na­tional names to take over the re­main­ing leisure space.

Its newly- re­fur­bished an­chor store, Mor­risons, which was the first store in the chain us­ing a new brand shopfront de­sign, is trad­ing ahead of ex­pec­ta­tions, Mr Ziff said.

Mean­while, the group has dis­posed of the Sains­bury’s Lo­cal build­ing, for­merly Austin Reed, on Al­bion Street, Leeds for £ 6.5m. The group has a fur­ther £ 20m of as­sets ear­marked for dis­posal over the next 12 months.

Mr Ziff said: “Whilst we are busy, we are cau­tiously busy with ac­qui­si­tions and dis­pos­als, try­ing to marry them.”

In the group’s half year state­ment, Mr Ziff said: “Our to­tal share­holder re­turn over the last six and twelve months of 13.3 per cent and 26.7 per cent re­spec­tively places the group in the top quar­tile of the sec­tor.

“We con­tinue to achieve this by the in­ten­sive as­set man­age­ment of our prop­er­ties, con­cen­trat­ing par­tic­u­larly on in­come.”

On arena nights the bars and restau­rants are buzzing un­til 11pm. Ed­ward Ziff, chair­man and chief ex­ec­u­tive of Town Cen­tre Se­cu­ri­ties.

ED­WARD ZIFF: The chief ex­ec­u­tive of Town Cen­tre Se­cu­ri­ties be­lieves low in­ter­est rates, low in­fla­tion and a strong pipe­line of work will boost fu­ture re­sults.

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