South East: Runnymede acquires £150m offices to generate investment funds

Runnymede Borough Council has bought two prime South East offices for in excess of £150 million as it seeks to generate funds to reinvest in regeneration opportunities in its borough.

Runnymede has bought the Pine Trees complex in Staines in the Runnymede area from clients of Aberdeen Standard Investments for £80.7m.

The five-building complex comprises around 110,000 sq ft of offices leased to tenants including Bupa and the United Kingdom Accreditation Service.

BNP Paribas Real Estate advised Aberdeen Standard Investments. Runnymede’s own internal specialist team acted on behalf of the Council.

Separately Runnymede has bought the 101,237 sq ft VW Financial headquarters in Milton Keynes from UK & European Investments for £50.15m.

Runnymede Borough Council was advised by Hanover Green, while UK & European Investments was advised by JLL.

Local authorities have notably been one of the most active investors in real estate over the past two years after a withdrawal of central government funding coupled with the April 2016 Public Loan Works Board (PWLB) in April 2016, which saw central government offer low margin loans to local authorities. The two factors have seen real estate emerge as one of the key ways for local government to find new ways to fund services by creating new revenue streams.

Local authorities spent almost £1.9 billion on UK commercial property in 2017, eclipsing the previous record high set in 2016, according to CoStar’s investment data.

The trend sees no sign of slowing with CoStar's first quarter investment report recording in excess of £500m of acquisitions, the largest of which was Spelthorne Council's acquisition of 12 Hammersmith Grove for £170m.

Source: CoStar