Adderstone Group in Record Subsidiary Disposal

Posted on 28 November, 2013 by Cliff Goodwin

A North-East based company has completed the sell-off of two of its subsidiaries in one of the region’s biggest property transactions.

The Adderstone Group has sold UK Ground Rent Estates Ltd and UK Ground Rent Estates (2) Ltd  for £17m in a deal which included an ongoing management contract from the new, undisclosed buyer.

Tim Clark, a director of the Newcastle-based company, said it was still very much on the acquisition trail, but that an offer for two of the group’s businesses proved too good to resist.

“We are still acquisitive in this sector, but ground rent investments have become increasingly sought after by some major institutional investment houses,” said Clark. “Yields have contracted in recent years and we were made an offer for our more mature portfolios that was quite simply too good to refuse.”

The deal was supervised by Bond Dickinson. “We are delighted to see a local company successfully compete and demonstrate expertise in a sector dominated by London-based investment houses and more recently some of the big institutional players,” said John Ralph, a partner in the commercial law firm and head of its real estate sector. “We are pleased to have been able to support the growth of the group over the years.”

The £17m financial injection will do nothing to harm Adderstone’s finances in what is proving to be an impressive year for a company with an extensive portfolio of office, leisure and residential ventures. It also has a number of new developments underway.

Due for completion early next summer, one of its biggest projects is Union Square, a £17m student accommodation development in Newcastle’s Upper Ouseburn. The eight-storey, 228-bed apartment block will create 100 new jobs when it takes in its first students in September, 2014.

And only days after it’s £17m disposal — thought to be among one of the region’s biggest this year — Adderstone heard it had won an 18-month battle for  permission to build premium offices next to the Tyne Bridge on Gateshead’s Quayside. The go-ahead for the two-storey development was finally granted on appeal by the Secretary of State after planning officers’ initial recommendations for approval were rejected by councillors.

The 259sq metre scheme will provide high specification office and other commercial space on a prestige site with views over Gateshead and Newcastle’s regenerated quaysides. Julie Booth is director of Intersect Architects. “Our aim throughout the design process has been to integrate the new building into its existing setting and provide a distinctive, contemporary structure in this prominent location,” she said.

Describing the project as “highly significant”, Adderstone’s managing director, Paul Tognarelli, said: “We spotted huge potential in the market and created the ability to develop that potential very effectively. Proceeds from this deal will be invested into our development pipeline bringing about further regeneration for the region. We have,” he added, “definitely sensed an upturn in the local economy.”




One response to “Adderstone Group in Record Subsidiary Disposal”

  1. Jordan says:

    Great local company, nice to hear a success story in the industry for a change! Well done.

Leave a Reply

Your email address will not be published. Required fields are marked *

This site uses Akismet to reduce spam. Learn how your comment data is processed.


Recent Posts

Interest Rates Impact on Commercial Property

Commercial Property Investment Outlook for 2023

The best places to stay on the Riviera

The latest property data has identified Newquay as the fastest property seller’s market in the UK

Investing in your garden can increase your property’s value

French Riviera temping high-end homebuyers

How can the ownership rights of my commercial property impact a business sale?

Should I incorporate virtual property viewings permanently?

Investment expected to increase across Asia-Pacific in 2021

UK property industry slows as the conclusion of tax break looms

BNP Paribas cautioned investors on Friday as debt-trading bonanza that increased its earnings this past year

Over 300,000 property purchases fell through in 2020 – we show the most frequent motives and the best way to get your house sale back on track

House Prices in the Capital Surpass £500,000

Optimism from the Bank of England’s chief economist

The most expensive commercial properties.

Businesses operating from shared premises will miss out on grants