Spelthorne Borough Council is to change its commercial property investment strategy and focus mainly on housebuilding.
The Surrey council is the top local authority investor in UK commercial real estate, investing close to £950m over the past five years.
However, in a new capital strategy, due to go before cabinet on Wednesday, the council says it has “achieved our objective of significantly boosting our income to support provision of services”, which has enabled it to avoid cuts to services such as meals-on-wheels and day centres.
The document says: “The focus of the council was previously to generate revenue in order to safeguard its basic services. The focus now is on providing affordable housing.”
Spelthorne is now aiming to build up to 600 homes over the next five years, representing a fifth of the housing requirement in its new local plan.
The council borrowed £393m in 2018-19 to fund its commercial property investments. However, it is only planning to borrow £119m over the next two years.
Previously Spelthorne had mulled over potential acquisitions in London. These included 100 Cheapside, EC2, from Aberdeen Standard Investments for around £140m and One Embassy Gardens, SW8, which owner Ballymore has put on the market for circa £160m.
However, the council has decided to not proceed with these purchases.
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