13th Jul 2007 07:00
Derwent London PLC13 July 2007 13 July 2007 Derwent London plc ("Derwent") announces £175 million of sales Derwent is pleased to announce the disposal of three non-core assets which wereacquired through the merger with London Merchant Securities plc in February thisyear. The sales total £175.0 million, before disposal costs, and achieved£91.8 million above the 31 January 2007 book value of £83.2 million. Thetransactions are: • Disposal of Greenwich Reach, SE10. Completion has taken placeto Roamquest Limited, part of Galliard Homes, for £111.8 million. This eightacre cleared site is on the South bank of the Thames, overlooking Canary Wharf. The site currently has planning consent for 980 residential apartments and71,155 sq ft of commercial/retail space. • Contracts have been exchanged on the disposal of 158-166Brompton Road, Knightsbridge, SW3 to a private purchaser for £45.0 million.This property comprises retail, office and residential space, totalling 27,000sq ft and produces a short term income of £0.8 million per annum. • Contracts have been exchanged on the disposal of 3 & 4 SouthPlace, EC2 to the Frogmore Group for £18.2 million. Situated close to Broadgatein the City of London, the properties comprise two adjacent vacant officebuildings totalling approximately 36,000 sq ft. These sales are the first since Derwent converted to REIT status on 1 July 2007.Both South Place and Brompton Road are within the tax exempt REIT ringfenceand will therefore not attract tax on their disposal. However, since theGreenwich property falls outside the REIT ringfence any capital gains arrivingfrom its sale will be chargeable to tax. John Burns, Chief Executive of Derwent London commented: "We are delighted with the substantial premiums achieved which were accomplishedso soon after our REIT conversion, at a level of 110% above book value. The saleof Knightsbridge and South Place enable the Group to achieve significantbenefits from the REIT status by disposing of two properties, which were not inour current development programme, in a tax efficient manner. The Greenwich saleis a non-core disposal as the Group continues to concentrate its efforts oncommercial development, where it considers its expertise are better applied thanresidential schemes of this magnitude. "Proceeds from the sales will be channelled into our substantial pipeline ofrefurbishment and redevelopment schemes as well as future acquisitions. Furtherdisposals of non-core and provincial properties will follow. These salesendorse the strength of the London property market and Derwent London'scommitment to concentrate on major office and refurbishment schemes within ourchosen Central London villages." -ENDS- For further information please contact: Derwent London Tel: 020 7659 3000John Burns Financial Dynamics Tel: 020 7831 3113Dido Laurimore / Nicole Marino Derwent London The merger of Derwent Valley Holdings and London Merchant Securities took placeon 1st February 2007, creating Derwent London plc, a leading central Londonoffice specialist with a combined portfolio valued at £2.4 billion, of which 84%is located in central London. The combined portfolio offers a wealth ofpotential and Derwent London will continue to build on the core strengths of thecombined business, drawing upon the existing strengths of both Derwent Valleyand London Merchant Securities. Derwent London has an extensive pipeline of development and refurbishmentassets. Continued focus will remain on the central London market where itsestablished design led philosophy and creative management approach todevelopment will continue to generate rental and capital growth. However thesynergy created by the merger will also provide the necessary leverage and scaleto allow the new business to undertake significantly larger developmentprojects. In total, 5.2 million sqft of development or refurbishment projectsare in the pipeline, of which 2.2 million sqft is currently on site and 3million sqft is scheduled for the future. This information is provided by RNS The company news service from the London Stock ExchangeRelated Shares:
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