19th Feb 2014 13:38
LONDON (Alliance News) - Palace Capital PLC Wednesday said it has completed the sale of its freehold interest in an office building in Leeds for GBP1.1 million, which after costs is a 13% premium to book value, and will help it to reduce its bank borrowings and boost its cash flow.
Gelderd Point, the 20,500 square foot property, has been vacant for "some time" and was sold to a Lincolnshire-based property company.
It sold three other properties and said the disposals will reduce net debt by GBP1.1 million to GBP17.8 million, reducing its interest liability by GBP46,750 a year.
Palace Capital said it sold a 999 year lease on Unit F, Argent Court, Tolworth, Surrey. The lease to the existing tenant had expired last December and has been sold on a long lease for GBP270,000 to the occupier.
It also sold an 800 year lease on Unit 3, Meadowcourt 1, Sheffield, a vacant office unit which has been sold for GBP135,000 to the South Yorkshire Police Federation, and has let more space at Hudson House, York to Carillion Construction Ltd & The Keystone Project at an aggregate rental of GBP40,110 a year exclusive.
"The disposal of Gelderd Point, Leeds means that since the completion of the acquisition of the Sequel Portfolio last October, the two vacant office buildings have been sold at above book value," Neil Sinclair, managing director, said in a statement.
"Coupled with the other sales and lettings referred to in this announcement and those previously announced, the company has reduced its net debt and irrecoverable expenditure considerably, thereby significantly increasing cashflow. The Company continues to manage its properties very actively," he added.
Palace Capital shares were Wednesday quoted at 247.12 pence, down 2.88 pence, or 1.2%.
By Samuel Agini; [email protected]; @samuelagini
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