Hansteen receives £37m in initial CPO payment for Saltley Business Park to make way for HS2

By James Wallace - Tuesday, March 13, 2018 13:37

The Secretary of State for Transport has bought Hansteen’s Saltley Business Park in Birmingham through a compulsory purchase order (CPO) to enable construction of the first phase of the government’s new high-speed rail network, HS2.

Hansteen has been paid an initial of £36.96m pending a “mutual valuation process” to establish the property’s market value. Saltley Business Park was on Hansteen’s balance sheet as an uncharged property after the listed investor repaid a £20m RBS senior loan in August 2017.

Hansteen confirmed that the initial proceeds from the CPO sale will be used to reduce the balance on its £330m revolving debt facility with RBS. According to Hansteen’s half year results to 30 June 2017, the RCF was £318m drawn, with more than three years unexpired and an all-in price of 2.4%.

Saltley Business Park comprises a substantial multi-let industrial estate totalling 1,078m sq ft in 22 units with an ERV of £4.6 million per annum. The Park is situated on a strategic, self-contained site of approx. 47 acres, on the eastern edge of Birmingham City Centre, with easy access to the M6.

The initial phase of the £56bn railway high-speed rail line is between London and the West Midlands and will allow trains to operate at speeds of up to 250mph – faster than any current operating speed in Europe. It is due to open in December 2026, although the Public Accounts Committee has suggested this timeline if overly ambitious.

The CPO was mandated under the High Speed Rail (London - West Midlands) Act 2017. The government has provided detailed information for investors, homeowners and landowners who are affected by the planned HS2 route which offers either outright purchase by the Secretary of State for Transport at its ‘unblighted’ value or offer of a lump-sum payment if property or land is near the proposed High Speed Two (HS2) route.

James Wallace is a freelance consultant and can be reached via WhatsApp on 07825 382670 or email: jawallace32@gmail.com


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