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UK cities eye asset sales to Middle East
Birmingham approached by sovereign funds while Liverpool is reviewing assets, and Somerset is selling farms.
September 22, 2010 1:12 by Reuters
Rural communities too are looking for ways to raise cash. Ken Maddock, leader of Somerset County Council in the south of England, expects to sell about two-thirds of 60 farms owned by the council as it grapples with 350 million pounds in debt.
“Like every other council in the country, we all face huge cuts in our funding,” he told reporters this month. “We will have to stop almost all our major building projects.”
Somerset’s so-called County Farm Estates run to about 7,200 acres which could be worth more than 40 million pounds based on the Knight Frank Farmland Index showing English farmland selling for 5,769 an acre in the second quarter of the year.
Elsewhere in Britain council officials say Darlington Borough Council is in protracted talks about the sale of a stake in Newcastle Airport while authorities stretching from Camden in London and to Bolton in the north of England are reviewing the value of billions of pounds worth of property assets.
Central government is also taking a closer look at its portfolio of assets, with trophies such as state-owned bookmaker the Tote up for sale.
In Birmingham, which describes itself as Europe’s biggest local authority, Whitby said Kuwaiti lead developer Salhia International Investments has already invested about 200 million pounds in the Beorma quarter development, the latest phase in the regeneration of the city centre.
Plans to knock down and relocate the main library and redevelop the site in the heart of the city have also caught the eye of Middle Eastern investors, said Randal Brew, a locally elected lawmaker responsible for finance.
“We have been successful in attracting quite a lot of Arab money, the leader has gone out and marketed the city,” Brew said during a recent visit to the city by Reuters reporters. “It is important because it is a new source (of investment).”
The local business community is also busy forging ties with Middle Eastern investors, highlighted by a visit this month from Sheikh Ali al-Hashimi, religious advisor in the United Arab Emirates ministry of presidential affairs.
“We want to see if we can get sovereign wealth attracted to projects in Birmingham,” said Noor Siddiqi, a lawyer, who organised al-Hashimi’s trip. “London has the attention of most of the world but other regions like Birmingham have a massive Muslim community and can relate to Muslim countries.”