Bruntwood to begin speculative builds after earmarking capital

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DEVELOPER Bruntwood is to press ahead with the speculative development of two high-profile city centre sites after earmarking capital for the schemes.

The company said it was no longer dependent on pre-letting space to start work on City House, above Leeds train station, and No. 3 Sovereign Square, also in Leeds.

A spokesman said a combination of confidence returning to the market, significant interest in the buildings, the refinance of £600m of debt and the recent £132m sale of City Tower in Manchester had enabled it to bring forward development plans.

Bruntwood bought the 120,000 City House in 2010 and obtained planning permission to redevelop the 14-storey building, which dates from 1962 and has been empty for some time.

The firm said the redevelopment of the building, coupled with Network Rail’s redevelopment plans for Leeds Train Station, had the opportunity to “totally transform” the gateway to Leeds.

It added that it expects to make further announcements on its plans for the building over the coming months.

Meanwhile, Bruntwood and Kier Property submitted a planning application for the 93,240 sq ft, six storey, No. ​3 Sovereign Square, at the corner of Sovereign Street and Swinegate, south of Leeds station, in April.

It is due to be considered by Leeds City Council in early July.

Development is already underway for a new regional office for KPMG at No. 1 Sovereign Square. The site is a crucial part of the council’s plan to establish a new, attractive setting for a city centre development and to form a link with the South Bank’ proposals, which include a new city park and a terminus for the HS2 eastern route.

Craig Burrow, director at Bruntwood in Leeds, said: “We have already been in talks with potential occupiers ​over both buildings ​and​ are ​not ​necessarily ​dependent on pre-lets to bring these two schemes forward.

“Both these developments are significant to Leeds bringing regeneration to two high profile locations within the city.

“Undertaking the developments of these two buildings at a similar time is an ambitious task however the property market is definitely on the up as we’ve seen from other recent announcements.

“It ​demonstrates our long term commitment to the city and ​signals positive news for the future ​growth of the Leeds economy.”

The company saw pre-tax profits rise by 42 per cent to £16.8m in its last financial year, with chief executive Chris Oglesby predicting that 2014 would be the company’s busiest year ever.

Family-run Bruntwood has more than 110 office buildings across Leeds, Manchester, Liverpool and Birmingham.

Bruntwood said that its “robust” performance reflected an increase in occupancy rates with over half a million square feet of space let in 2013, including 25 per cent of the Manchester city centre office market.

Performance across Leeds, Birmingham and Liverpool was also strong, it said.

Bruntwood’s net worth fell to £286.4m, down five per cent from 2012.

In Leeds, the redeveloped 100 Wellington Street was fully let in six months, whilst in the Liverpool market Bruntwood secured one of the largest lettings of the year with the expansion of Bosch at The Plaza.