Milton Keynes parks custodian gets £30m loan to buy more property

Finance | Tania Mason | 11 Feb 2010

The Parks Trust, the charity that looks after Milton Keynes’ parks and green spaces, has taken out a £30m loan to buy further commercial property in the city.

The Trust already has a large portfolio of commercial property, comprising office blocks, leisure centres, industrial buildings and the odd pub and hotel.

The loan, from Swedish bank Handelsbanken, will enable the charity to double the size of this portfolio and generate long-term rental income and capital growth.

Property manager Jenny Strathern said: “We’re looking to diversify our current portfolio, considering retail warehousing, some high-street retailing, top-quality warehousing units with excellent transport links and some health clubs.

"All these types must have a first-class tenant covenant – so good financial stability of the tenant and currently holding long tenancy agreements. So we’d be looking for property with tenants holding an 18 to 25-year lease.”

The Trust receives no income from the government or local authority and is totally self-sustaining, unlike most other towns and cities where the parks are funded out of council tax.

Trust chief executive David Foster said: “By taking this bold step now the board of the Trust has shrewdly grasped the opportunity to borrow money for further investment at a time when interest rates are at a historical low and quality commercial property can be acquired at a reasonable price.” He claimed the investment would play a major part in giving the Trust “long-term financial stability”.

The Trust was advised by Torrin Asset Management and Baker Tilly Corporate Finance. No details were disclosed about the terms of the loan.

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