Bruntwood pushing ahead with facelift of city’s iconic building

COMMERCIAL property firm Bruntwood yesterday confirmed that it was “pushing forward” with plans to revamp a major office building in Yorkshire, as it reported an increase in full-year profits and revenue.

City House in Leeds
City House in Leeds

Bruntwood is in talks with a number of parties who are interested in moving in to the 14-storey City House, which stands next to Leeds Railway Station.

In a sign that the commercial property market could be about to undergo a revival, Bruntwood revealed that it had just recorded its best year for new lettings since 2007.

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In the year ending September 2012, the company’s profit increased by 10 per cent to £12.4m and turnover rose by six per cent to £105m.

Net worth fell slightly to £303m, down five per cent from 2011, which the company attributed to the knock-on effect of the recession on the property market.

After securing a new £120m 10-year facility with Legal and General in January, Bruntwood’s group refinancing has taken another step forward, after it secured agreement for a £229m extension of its Commercial Mortgage Backed Securitisation (CMBS). The extension to January 2016 was passed unanimously by bond holders at an extraordinary general meeting on Tuesday.

Chief financial officer Kevin Crotty said: “In recent weeks we have secured nearly two thirds of our group refinancing requirements.

“Agreeing a new 10-year facility and passing a unanimous CMBS extension vote is a strong show of confidence for the group, and demonstrates that there is demand out there for the right proposition.”

According to chief executive Chris Oglesby, the business is growing into new sectors, and 2013 will be one of its busiest years for new developments.

Projects due to start this year include four hotel schemes in three cities, an 80-bed care facility with Care UK in Greater Manchester, the development of Manchester Business School with the University of Manchester and the completion of 94,000 sq ft of state-of-the-art medical facilities at Citylabs.

He added: “In addition to all this, we’re pushing forward with our ambitious plans for City House in Leeds.”

City House was bought by Bruntwood in July 2010 and the company hopes to have it ready for occupation this year.

In 2011, Bruntwood obtained planning permission to redevelop City House, which dates from 1962 and has been empty for seven years.

In January, Craig Burrow, the director of Bruntwood’s Leeds operations, revealed that City House had attracted interest from a wide range of potential users.

He said at the time: “There could be multiple uses for the building – one possibility is a hotel, but there could also be interest in using it as offices and a gym.”

Yesterday, Mr Burrow confirmed that Bruntwood was still talking to interested parties about City House, along with Network Rail.

He added: “It’s an important landmark for the city and we have got to deliver an appropriate scheme.

“Leeds is very much a focus in the Yorkshire market, and we continue to keep an eye on the other cities.”

This year, Bruntwood is also due to begin the redevelopment of three of its office buildings in Manchester city centre: Overseas House, Elliott House and Bank Chambers.

Bruntwood owns and manages more than 100 UK office buildings.

The company provides office space, serviced and virtual offices, meeting rooms and retail premises to companies of all shapes and sizes across a range of sectors.

In recent years, Bruntwood has continued to invest in commercial property, despite the uncertainties caused by the financial crisis of 2008, and the deep-rooted troubles in the eurozone.

A number of its most significant developments have been in Manchester.

In late 2012, Bruntwood, revealed that it was investing more than £2m to redevelop the 21-storey Portland Tower, at 53 Portland Street, Manchester.

Bruntwood also announced it was re-naming the building ‘Manchester One’, which reflects its M1 postcode and central location.

Going west with purchase

Bruntwood, a family-owned commercial property company, owns a number of high profile sites in Leeds, including West One and 100 Wellington Street, which it bought for £2.5m last year.

100 Wellington Street has been absorbed into the West One Estate. The first phase of redeveloping 100 Wellington Street was completed in late 2012. In January, Craig Burrow, the director of Bruntwood’s Leeds operations, said the building had been “very well received”.