In a joint venture agreement with Liverpool-based remediation specialist BXB, Promenade will ‘clean’ the sites ready for use by housebuilders. Tony McDonough reports
Merseyside developer Promenade Estates is to embark on a multi-million pound buying spree to acquire brownfield sites and transform them into ‘clean’ locations for housebuilders.
Promenade, whose previous local projects include Marine Point in New Brighton, Ramada Plaza in Southport as well as the Observatory in Liverpool, has signed a joint venture agreement with BXB, a Liverpool-based land remediation specialist.
Thanks to the disposal of those projects, the most recent being the sale of the Observatory to social housing provider Torus, Promenade has built up a significant “fighting fund” which it now intends to use to acquire individual brownfield sites from PLCs, government agencies and utilities via special purpose vehicles.
It will use BXB’s remediation and planning skills to bring the land to market as ‘clean’ development sites, with most expected to appeal to housebuilders.
The move is in response to the Government’s drive to create millions of new homes. The JV will target the acquisition of large, constrained sites that registered social landlords and private developers would consider too large and risky for their balance sheets.
The joint venture has agreed the terms of its first deal for a major former industrial site in the north west of England and is negotiating on a number of other opportunities, says Promenade chairman Peter Hynd.
He added: “Our JV is an intelligent combination of skills and resources to address a major strategic issue for both Government and housebuilders. If we can free up more brownfield land we can speed up the supply of homes without eating in to the green belt.”
Gary Goodman of BXB says the firm’s long track record in the sector will be key both to sourcing sites and managing their remediation and promotion through the planning process.
“There are very few companies with our combination of skills and resources to apply in this context and our first deal, which we will be able to announce shortly, demonstrates that major corporations understand that we make good custodians for their legacy land,” he said.
“We can also acquire difficult, surplus sites owned by large corporations so that they can divest of liabilities and secure cash to invest in their core businesses. We remove risk from their balance sheet whilst generating cash for them.”
Promenade Estates was advised by Hill Dickinson, with Bermans advising BXB. Mason Owen is advisor to the joint venture on its current and future acquisition activities.