Stobart flips Ford land at £20m profit in three months
Stobart has sold a chunk of motor storage yard near to the Jaguar Land Rover factory in South Liverpool for £37m, acquired in February for £15.6m.
Further to an announcement to the stock exchange in March, Stobart today said it had unconditionally exchanged contracts for the sale of 47 acres in Speke for £37m cash.
The site is used as a car dispatch area for around 100,000 Ford vehicles each year on their way to dealers in the North and Midlands.
Ford has been a tenant on the site, bounded by New Mersey Shopping Park, the West Coast Main Line, Speke Road and Speke Hall Road for more than 50 years.
Ford agreed an option to buy the land in March at the same time as agreeing a new 20-year lease starting from 1 July at a rent of £2.16m a year. Ford had until the end of June to buy the site before the lease kicked in.
Stobart said its initial intention was to hold all of the 53-acre site as an investment property however it agreed the option to acquire and completion will take place on 31 May. The remaining six acres could be used for future development. Stobart also has extensive land holdings at the 3MG multi-modal gateway next to the Mersey down the road in Widnes.
The part of the Speke site that Ford is acquiring cost Stobart £15.6m, bought from Oaktree Capital Management in February, and is held on the balance sheet at £25.2m, generating an annual rental profit of £0.7m. The sale will result in a significant profit of approximately £11.8m for the group in the current financial year. Stobart took a £9m revaluation gain in the last financial year.
US car giant Ford sold the nearby factory in Halewood, Knowsley to Tata Motors in 2008. The Range Rover Evoque and Land Rover Discovery Sport are produced there. Ford retains and still operates the transmission plant next to Halewood in a joint venture with Getrag.
Stobart said it would consider its options for how best to use the proceeds, including returning surplus cash to shareholders.
Andrew Tinkler, chief executive, Stobart, said: “We are very pleased to have realised further value and generated significant profits from our investment property portfolio with a transaction that demonstrates the hidden value within our infrastructure and investment divisions.”
The site was the subject of a failed proposal five years ago by Belfast-based property company Benmore to develop a cinema, hotel and shops.
