Leeds sells off £93m of property portfolio

Leeds City Council has approved a plan to dispose of £93m of property assets from its portfolio. Earlier this week, the council’s executive board voted to progress the asset management plan, which aims to save £4.5m in revenue costs between 2014 and 2017.

The council says that it has already disposed of £27m worth of assets, which has resulted in £6.5m of revenue savings, and says another £4.5m will come from sales which could reap £66m in capital receipts. A report to councillors said: “Currently, the council spends £40m per annum on its property portfolio and in the context of the Council’s financial challenges, careful consideration and review is needed to ensure that our land and property assets are fully contributing to the Council’s objectives and the on-going economic, social and cultural development of Leeds.”

The council currently owns 9,700ha of land and 59,000 properties valued at around £8bn, including the council housing and school portfolios. It holds 6,000 property interests, of which around 4,000 are currently leased – Leeds Arena, the commercial investment portfolio, the small industrial units (SIUs) and an agricultural portfolio. In addition, there are around 350 properties used by the council for service delivery. According to officers, council departments have all committed to sharing assets and reducing surplus space, with 56 properties identified for vacation over the next four years – providing savings in excess of the £4.5m target.

However, the plan says that the size of the council’s investment portfolio could grow from the current 3,911 properties it owns, in order to generate more income. The report said: “This includes targeted acquisitions where supported by a strong business case, but also some rationalisation of the existing commercial and investment portfolio, and taking decisions about properties which do not generate sufficient income or are wasteful of management resources.” Where existing properties have greater potential to generate income, they will be retained and developed in partnership with third parties. Such land could also be rented for commercial advertising. Land located within areas earmarked for regeneration could be sold to private sector firms after planning briefs are drawn up to guide the form of development.

The council was one of 12 authorities selected by central government in 2013/14 to pilot a cross-public-sector approach to the use of assets. “Leeds’ involvement in the pilot has been so successful that the council has been asked to extend involvement in year two to include Bradford City Council and public partners covering its metropolitan district,” according to officers.

Photo (cropped): “Light Night over Leeds” by Carl Milner is licensed under CC BY 2.0