Wates Group moves into West Berkshire Council-owned building at Newbury Business Park

A BUILDING bought by West Berkshire Council which has sat vacant for three years has been let.

Construction company Wates Group has moved into part of 4 The Sector at Newbury Business Park.

The company has taken up 30 per cent of the 28,700 square foot building, which the council purchased for £8m in April 2018 as part of its commercial property investment programme.

As part of the deal, the company that sold the building agreed to pay rent, rates, and service charges until April 2020.

The council's executive member for finance and economic development, Ross Mackinnon (Con, Bradfield) said the lease was "a massive vote of confidence for Newbury in particular and West Berkshire in general to let such a big space.

"We now don't have any vacant properties in the portfolio," he said.

The council voted to borrow up to £100m from the Public Works Loan Board (PWLB) to spend on commercial property and use the rents to support its revenue budget.

It has spent around £63m on nine properties across the country, and was collecting £3.6m gross (£1.1m net) from its £62.6m spend, with the aim to make a profit of around £1.26m (two per cent) each year.

Mr Mackinnon said the council would not be investing more in commercial property following changes to guidance and the Government saying that councils should stop borrowing from the PWLB to invest in property purely for profit.

He said: "The current market value of the portfolio is £63m. We have not suffered paper capital losses. Not that the scheme is to make capital gains, it's to generate income to support the revenue budget."

He added that about one per cent of council tax did not need to be raised because of the £1m in rent earned from commercial property.

Although the amount Wates paid for the space at 4 The Sector could not be revealed for commercial reasons, Mr Mackinnon said "it was pretty much what you would expect".

"Having a tenant in there makes it more attractive for people to come in there," he added.

“A major company choosing to move to West Berkshire is a real vote of confidence in the area, and shows we are well-placed to bounce back from the effects of the pandemic.”

Along with 4 The Sector, the council spent £9.7m on The Sector at Newbury Business Park.

It also spent £3.5m on a petrol station in Tipton and £9m on a property occupied by Sainsbury’s in Yorkshire.

It also purchased Unit 1&2 Hill View Road, Guisborough, occupied by an Aldi and Iceland, for £6,048,000.

Shopping units at 303 High Street, Lincoln, were bought for £5,665,000, along with 2 Waterside South in the town for £2.9m.

An industrial unit at 79 Bath Road, Chippenham, was also acquired for £9.2m.