56 commercial property
Regenerating a bright future
For growing businesses in the Thames Valley, the economic recovery is bringing new challenges as well as fresh opportunities. The region’s commercial building stock, last added to extensively in the 1980s, is ageing and now under pressure as companies struggle to find the right premises for expansion. Reading-based firm McKay Securities PLC has responded with a focus on expanding its portfolio of office and industrial/ warehouse properties in the South East, providing local businesses with the space and facilities they need to flourish, writes Bea Longworth
Founded in 1946, commercial property investment company McKay Securities has its roots in the post-war housing boom and in 2007 became the UK’s only Real Estate Investment Trust (REIT) focused solely on South East England and London. Since flotation on the London Stock Market in 1959 the company’s growth has been largely organic, but earlier this year the company elected to raise additional capital, doubling the size of its business and bringing its market capitalisation to over £200 million.
“We specialise in development and refurbishment, and our commercial model means we have a long-term investment in the success of our region’s business community,” explained McKay's managing director Simon Perkins. “Unlike a conventional developer, we are not looking for a quick sale. We buy office and industrial/warehouse properties, undertake improvements to align them with what occupiers want, and then actively manage them to generate rental income and increase their value. With the return of confidence we’ve seen over the past 12 months, demand for better quality buildings is increasing while supply is at a historic low. The funds raised will allow McKay to expand its property portfolio and grow into this improving market.”
The company’s success has been built on a commitment to the quality of its buildings and its reputation as a sympathetic landlord, coupled with an ability to spot the potential in neglected properties and areas. In the case of 9 Greyfriars Road in Reading, one of the company’s most recent acquisitions, this process is literally taking place on McKay's doorstep.
www.businessmag.co.uk One Fleet, Ancells Business Park
“Our own office is just across the street so it will be very easy to keep track of progress,” said Perkins. “9 Greyfriars Road is a great example of what we look for in a property. It’s a 1980s building that now looks tired but its core characteristics give a good base to work from and its location means it will be ideally placed to benefit from the regeneration centred on Reading’s railway station and Station Hill. We acquired the property in May and a comprehensive refurbishment scheme by Reading-based architects Barton Willmore and other local consultants will transform it into modern business space, scheduled for completion in late 2015.”
It’s McKay's direct relationship with its tenants that ensures the company maintains a strong focus on the needs of the market
As well as identifying locations and buildings where the company can add value over time, McKay has its finger on the pulse of what appeals to Thames Valley businesses looking for new offices. An attractive, modern façade and reception area that provide a great first impression are perennial requirements, but the best commercial premises must offer beauty that’s more than skin deep.
“Talking to potential tenants, we’re finding that features such as bike racks and showers are increasingly important,” Perkins said. “Employers want to attract the best staff so their offices must be pleasant places to work with stand-out facilities. Businesses are also seeking out buildings that are energy efficient and benefit from environmentally friendly air conditioning and other building services. Not only do these features help to reduce running costs, they also send a powerful message about companies’ corporate commitment to being green.”
It’s McKay's direct relationship with its THE BUSINESS MAGAZINE – THAMES VALLEY – OCTOBER 2014
tenants that ensures the company maintains a strong focus on the needs of the market. Rather than putting multiple management layers between tenant and landlord, which can turn something as minor as adjusting the air conditioning into a major issue, the company aims to be open and approachable. “Being based in Reading, our entire portfolio totalling 1.4 million sq ft is within easy reach,” Perkins continued. “We’re genuinely aligned with the interests of our tenants and try to be very hands-on in helping them get the most out of their premises.”
In addition to 9 Greyfriars Road, Reading, McKay Securities PLC has also acquired buildings for refurbishment in Woking, Windsor and Theale, while recently completed properties have entered the market in Bracknell, Fleet, Maidenhead and Hook. With two new asset managers on board and new equity to invest, Perkins is optimistic about the future. “Our intent is to continue growing our business within the South East. All our planned schemes involve redevelopment and regeneration to create good quality, desirable and affordable commercial spaces. This is of benefit to the entire region and, as the recovery matures, we look forward to continuing this positive circle of investment, renewal and reward.”
Details: Simon Perkins 0118-9502333
scp@mckaysecurities.plc.uk www.mckaysecurities.plc.uk
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