A start-up company headed by a British Land director and a former Hammerson managing director is to be listed on the Alternative Investment Market this month.
The pair, Michael Cassidy and John Parry, have set up Eagle Strategic Land with assets that include Hull City FC’s former stadium. The company’s AIM listing – to be priced at 65p per share – will buck the recent trend of public property companies going private. The listing will raise £7.5m.
ESL will comprise £10m of net assets, which have been brought back onshore by a company called Octopus Developments.
Led by Florida-based property entrepreneur Mel Griffin, Octopus built up its portfolio over the past three years. It now includes: the 10.5-acre former Hull City ground, Boothferry Park; an 88,000 sq ft office tower in Cheltenham; and 70 acres of greenbelt land known as The Ranges at Shepperton, Surrey.
Griffin will retain an advisory role at ESL. Octopus expects its shareholding to be less than 50% after the float.
ESL said it expected its assets to grow in value to around £24m by 2008. It has just over £10m of debt and will use funds raised in the flotation to leverage and expand the portfolio. It plans to trade properties rather than hold them as long-term investments.
Cassidy is a former chairman of the Corporation of London’s planning committee, a partner at law firm Hammonds and a non-executive director at BL. He said ESL would use its management’s experience and contacts to achieve planning and change of use applications quickly before selling assets on.
Cassidy will be chairman and Parry – MD of Hammerson between 1988 and 1993, a founder member of London First and former BPF president – will be a non-executive director.
“We think we can show the possibility of very swift capital gains. We aim to pay out our first dividend in 2006 – after a full 12 months of trading,” said Cassidy.
In Hull, ESL plans to seek planning permission for retail and residential development that would preserve the pitch of the football ground.
In Cheltenham, ESL hopes to let the main tower to help cover its overheads, and is in talks with potential tenants, including BAE Systems. A separate 22,000 sq ft tower on the site is likely to be sold off.
Cassidy added: “The company’s portfolio has some quite remarkable opportunities. If you put that at the heart of a company, you have a good story to tell potential investors.”
