Council invests £13million in Cambridge Science Park building
PUBLISHED: 12:36 15 March 2019
An office at Cambridge Science Park is being bought by South Cambridgeshire District Council to "generate funds for the future".
The council is investing £13 million in the building, 140 Cambridge Science Park, after members agreed the authority’s first ever investment strategy in February.
The rent on the building will provide the council with an initial net return of around 5.6 per cent. The tenants are the firm DisplayLink, who have more than ten years to run on their current lease.
The council’s latest budget agreed last month shows that it must find £3 million within the next five years to offset cuts to national funding. The purchase of this building is seen by the council as a way to invest money now to generate funds in future.
It is expected to provide a secure long-term income which the council can reinvest in services such as recycling and waste, housing support and planning.
The council says it already generates around £2 million a year itself. In the past, income had mainly been generated from Ermine Street Housing – the council’s private sector housing company.
By the end of March 2024, council investments are forecasted to return an income of £5 million a year which will be used to “protect the services local people want and need”.
A quarter of the money spent on services by South Cambridgeshire District Council is expected to be generated from the council’s investments within five years.
South Cambridgeshire District Council’s lead cabinet member for finance, Councillor John Williams, said: “With our recently-agreed investment strategy now in place, this is an excellent opportunity to buy an investment property which will give us a return to plough back into frontline services for many years.
“It’s a bit like buying a house in that we have agreed to proceed with the sale, but it is subject to satisfactory surveys and the relevant checks being done and us happy with the results. This is a rare opportunity to buy an office building, with tenants in place, in one of the world’s most prestigious science parks that sits right at the heart of one of the UK’s fastest growing economies.
“It is a positive for us that the premises sit close to home within South Cambridgeshire, and the funds generated by the purchase will go towards our savings targets during the next few years. The income generated by the rent will also help us to protect vital frontline services, like recycling and waste, housing support for vulnerable people and planning, in the face of cuts to national funding.”